Canada will retaliate against “unjustified, unwarranted” tariffs imposed by the United States with a 25% tax on US vehicles, says Mark Carney.
On Wednesday, Donald Trump announced wide-ranging tariffs on dozens of countries, but did not add new trade levies to Canada or Mexico. Despite the reprieve, however, the US has placed 25% taxes on Canadian steel, aluminum and vehicles.
“The president’s actions will reverberate here in Canada and across the world,” the Canadian prime minister said at a press conference. “They are all unjustified, unwarranted, and in our judgment misguided.”
In response to US trade policy, Carney said his government would impose the taxes on vehicles that are not compliant with the continental free trade deal. The new tariffs would not apply to auto parts and would not affect vehicle content from trade ally Mexico.
Carney’s comments come against the backdrop of a global economy in turmoil. Trillions have been wiped from markets as multiple nations digest a new – and grim – trading relationship with the United States.
The newly installed prime minister cited recent conversations with Mexico’s president, Claudia Sheinbaum, as well as with European leaders and trade officials amid a broader attempt to pivot trading relationships away from the US in the pursuit of “free and equitable” trade relationships.
“If the US no longer wants to lead, Canada will,” he said, outlining new relief measures for sectors affected by looming job losses, including using the money generated from the taxes to support workers and companies. “In this new world, we need to look out for ourselves. Because we are Canadian, we will always look out for each other.”
The trade war comes as Canada is in the midst of a federal election campaign.
Carney’s incumbent Liberals have experienced a dramatic reversal of fortunes in recent weeks, in large part due to the actions of Trump. Recent national polling suggests the party is likely to secure a majority government in the coming weeks if support holds.
Conservative leader Pierre Poilievre pledged on Thursday that if his party forms a government, he would “push hard to end the tariff madness” and “demand” a quick renegotiation of the pact governing free trade in North America. The Tory leader said he plans to remove federal taxes on automotive purchases, saving families thousands of dollars.
Experts agree that sustained tariffs on the automotive sector, as well as on steel and aluminum, would inflict the most damage in Ontario – the country’s economic engine and largest manufacturing base. Already, one car plant in the border city of Windsor has announced a temporary shutdown of two weeks, a move that will affect more than 3,500 workers.
Ontario’s premier, Doug Ford, who oversees an economy worth more than C$1tn, said he was a “strong supporter of showing the US that we negotiate through strength not through weakness” ahead of Carney’s announcement.
Ford told reporters the consensus among premiers was that Canada “got the best of a bad deal” in Wednesday’s theatrical unveiling of global tariffs, but that the current levies on Canadians goods remained “totally unacceptable”.
Source: theguardian.com
