{"id":8665,"date":"2026-09-07T20:37:37","date_gmt":"2026-09-07T20:37:37","guid":{"rendered":"https:\/\/nextcitydigest.com\/?p=8665"},"modified":"2026-09-07T20:37:37","modified_gmt":"2026-09-07T20:37:37","slug":"canada-set-to-hit-back-at-trump-tariffs-risking-wider-trade-war","status":"publish","type":"post","link":"https:\/\/nextcitydigest.com\/?p=8665","title":{"rendered":"Canada set to hit back at Trump tariffs, risking wider trade war"},"content":{"rendered":"
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By Derek Decloet, Josh Wingrove and Brian Platt, Bloomberg News<\/p>\n

Canada is poised to impose tariffs of 15% to 50% on hundreds of products from the U.S. on Tuesday, as Prime Minister Mark Carney bets that standing up to President Donald Trump will eventually help Ottawa\u2019s negotiating position with its biggest trading partner.<\/p>\n

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Barring a last-minute reprieve, Carney\u2019s government will increase the import tax on many U.S. steel items to 50% from 25% and apply tariffs to a range of consumer items \u2014 motorcycles, cosmetics, cheese and more.<\/p>\n

The measure will hit U.S. exporters particularly hard in states such as Michigan and Ohio that do a lot business with Canada and host heated races in November\u2019s midterm elections.<\/p>\n

It\u2019s a calculated risk for Carney, who a year ago removed many of the counter-tariffs his predecessor, Justin Trudeau, had implemented. Trump administration officials have repeatedly said they won\u2019t tolerate retaliation and noted that only two countries, Canada and China, have used counter-tariffs.<\/p>\n

U.S. officials have declined to specify how or when Trump may respond with fresh measures of his own.<\/p>\n

\u201cCanada\u2019s retaliatory tariffs are meant to make the cost of this trade war real enough for American businesses and consumers that Washington sees a clear incentive to return to the table,\u201d said Brian Clow, who was a senior Canadian adviser on trade and U.S. relations under Trudeau. \u201cCanada isn\u2019t imposing these tariffs because it wants a trade war. It\u2019s imposing the tariffs because it wants the trade war to end.\u201d<\/p>\n

U.S. and Canadian negotiators sought for weeks to reach a deal to lower trade tensions and had appeared to agree on the broad terms. Trump even announced on Aug. 18 that they had a preliminary deal and gave three days to work out the details. Then it fell apart. <\/p>\n

\n<\/div>\n

The collapse of those talks ushered in two weeks of venting and criticisms from both governments. Each side blamed the other for torpedoing an agreement in the final hours. They were still sniping over the weekend: Treasury Secretary Scott Bessent on Fox News compared Canada to a \u201clittle yippy dog\u201d barking at a much larger one.<\/p>\n

Trump lobbed another veiled threat on Sunday, saying \u201cCanada\u2019s (currency) Dollar imbalance with the U.S. is unacceptable,\u201d he wrote in a Truth Social post. \u201cIt has been that way for years \u2014 but no longer!\u201d The White House declined to clarify what he meant.<\/p>\n

U.S. tariffs of 50% on about $20 billion worth of Canadian goods took effect on Aug. 22. Canadian officials announced the details of their counter-tariffs three days later, which target a roughly equal dollar amount of American goods.<\/p>\n

The Trump administration has threatened to respond with additional measures against Canada, teeing up the prospect of the trade dispute spiraling even further. U.S. Trade Representative Jamieson Greer has signaled that more tariffs and even outright bans on certain imports from Canada are possibilities, but the timeline is unclear.<\/p>\n

\n<\/div>\n

In the meantime, Trump signed an order to rename Lake Ontario as \u201cLake America\u201d on U.S. maps and posted numerous social media messages disparaging Canada. His officials openly accused Carney of sabotaging the negotiations.<\/p>\n

\u201cThey decided for political reasons, domestically, they\u2019d rather fight with Donald Trump, even if it\u2019s bad for the economy of Canada,\u201d Commerce Secretary Howard Lutnick said on Bloomberg Television. <\/p>\n

A Canadian official, speaking on condition they not be identified, said that as of Sunday afternoon, no new meetings were scheduled with the U.S. administration. Neither the White House nor Greer\u2019s office responded to requests for comment in the days before Carney\u2019s newest tariffs were set to take effect.<\/p>\n

\u2018Written in pencil\u2019 <\/h3>\n

Carney, 61, has said the White House made \u201cunacceptable\u201d demands that would have infringed on Canadian sovereignty and hurt its industries, including heavy trucks. <\/p>\n

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The prime minister also took a verbal jab at the Trump administration\u2019s willingness to tear up or ignore trade agreements such as the U.S.-Mexico-Canada Agreement. \u201cWe recognized that sometimes its signature was written in pencil,\u201d he said. <\/p>\n

Public opinion surveys show support for Carney\u2019s decision to walk away from negotiations and to punch back with counter-tariffs. A poll conducted by Nanos Research for Bloomberg News last week found nearly three-quarters rated his handling of the trade file as \u201cgood\u201d or \u201cvery good.\u201d <\/p>\n

While the talks collapsed in sudden fashion, both sides have signaled since then that some sticking points have been resolved. <\/p>\n

The Americans have dismissed Carney\u2019s claim that French language rights are a deal-breaker \u2014 an issue the Canadians have publicly noted is effectively resolved.<\/p>\n

While Carney suggested last week to reporters that the U.S. was willing to extend auto tariff relief to medium- and heavy-duty vehicles, a U.S. official, speaking on condition of anonymity, called that claim false.<\/p>\n

Even with other issues unresolved, there are reasons to believe that it\u2019s in Canada\u2019s interest to try to negotiate a truce and de-escalate the situation. <\/p>\n

The performance of the Canadian economy has been uneven. After a period in which it stalled, growth bounced back in the second quarter. The number of people with jobs has increased by just 3,400 per month this year, on average. The layoff rate is higher in industries dependent on U.S. demand for exports, according to data from Statistics Canada. <\/p>\n

Canada\u2019s counter-tariffs may help protect some domestic manufacturers, but it will increase costs and leave many of its industries worse off, according to a report from Tony Stillo and Michael Davenport of Oxford Economics. They estimate that the combined effect of the U.S. tariffs, Canadian retaliation and related federal support programs will reduce output by about 0.3%, compared with its baseline forecast. <\/p>\n

That report takes into account only the tariffs that have been announced \u2014 not the possibility of another ratcheting up of the trade hostilities. <\/p>\n

\u2018Durable\u2019 deal<\/h3>\n

After talks collapsed last month, Trump announced that he would hike tariffs on autos to 50%, from 25% currently, and also impose a 50% rate on auto parts, with both effective Jan. 1. He hasn\u2019t yet taken formal steps to implement those levies and it\u2019s not clear whether that amounts to his promised retaliation on Carney\u2019s tariffs.<\/p>\n

Carney said last week his government is seeking a \u201cdurable\u201d agreement. \u201cWe\u2019re ready to sit down and strike that deal when the Americans are ready,\u201d he said, while reiterating that he won\u2019t sign anything unless it allows the Canadian automotive, steel and aluminum industries to stay competitive.<\/p>\n

House Speaker Mike Johnson also called for talks to resume.<\/p>\n

\u201cI think everybody wants that to happen,\u201d Johnson said Thursday, a day after Greer briefed House Republicans. \u201cWe need Canada to come to the table, and be in good faith, and work through this, because it\u2019s very important for both countries, and the members of this body believe that, and I think most Canadians do as well.\u201d<\/p>\n

\u2014With assistance from Erik Wasson and Mario Baker Ramirez.<\/p>\n

\u00a92026 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.<\/p>\n

Read more Recipe: A ceviche recipe for folks who don\u2019t eat raw fish<\/a><\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Canada is poised to impose tariffs of 15% to 50% on hundreds of products from the U.S. on Tuesday, as Prime Minister Mark Carney bets that standing up to President Donald Trump will eventually help Ottawa’s negotiating position.<\/p>\n","protected":false},"author":1,"featured_media":8664,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-8665","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"yoast_head":"\nCanada set to hit back at Trump tariffs, risking wider trade war - Next City Digest<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/nextcitydigest.com\/?p=8665\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Canada set to hit back at Trump tariffs, risking wider trade war - 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