Canadian Prime Minister Mark Carney warned that his government’s strategy to lessen dependence on the US will involve short‑term economic costs. In a video posted to YouTube, he said the shift will have a price, but the cost of doing nothing would be far greater.
The statement came hours after Canadian customs measures took effect in response to new tariffs imposed by Washington in late August. On Tuesday, Canada introduced additional duties of 15%, 25% or 50% on a range of American goods, including steel, dairy products, electronics and wood pulp.
The total value of the affected American goods is roughly $20 billion, or 27.6 billion Canadian dollars. According to Ottawa, this amount matches dollar for dollar the value of Canadian goods that have faced 50 % tariffs from the US since August 22.
Escalation of the trade conflict
The trade standoff between the two neighbouring countries reached an unprecedented level after Mark Carney broke off negotiations with the White House on August 21. The Canadian Prime Minister accused the US of trying to impose an unfair deal designed to turn Canada into a branch plant and to destroy its industries, especially the automotive sector. He also pointed to conditions set by Washington regarding the French language, a politically sensitive issue for Canada.
There are currently no plans to resume talks, and the two sides have been exchanging sharp statements for two weeks. On Monday, US President Donald Trump again threatened action against sales by Canadian aircraft manufacturer Bombardier. He also warned that tariffs on the Canadian automotive industry could rise from 25% to 50% starting January 1.
Despite public support, Mark Carney‘s strategy is economically risky because Canada relies heavily on its largest neighbour. Nearly 60% of Canadian imports come from the US, and about 70% of Canada’s exports are destined for that market.
To aid the sectors hardest hit by the dispute, the Canadian government has allocated 7.5 billion Canadian dollars (€4.6 billion). The funds will support business liquidity, bolster unemployment benefits and create a Diversification Fund for a Strong Canada to help the country find new export markets.
Source: BFMTV
