TORONTO (AP) — Prime Minister Justin Trudeau expressed relief on Thursday that the U.S. plans to delay significant tariffs on Canadian goods for a month. However, he confirmed that Canada’s retaliatory tariffs will stay in place for the time being.
U.S. President Donald Trump announced a similar month-long delay for 25% tariffs on most products from Mexico. This move comes amid concerns of a larger trade war. Earlier, U.S. Commerce Secretary Howard Lutnick indicated that delays for Canadian tariffs seemed likely, but no final decision was announced.
This marks the second one-month postponement Trump has implemented since revealing these tariffs back in early February. In Ontario, Premier Doug Ford stated that, starting Monday, the province would increase electricity prices by 25% for 1.5 million Americans affected by Trump’s tariff strategy. Ontario supplies electricity to states like Minnesota, New York, and Michigan.
Ford mentioned he would rather not raise charges but feels compelled to stand firm until all U.S. tariffs are eliminated. “This situation with President Trump is a mess,” he said, emphasizing the unpredictability of the tariff situation.
Canadian Foreign Minister Mélanie Joly voiced frustration, stating that Canada is not interested in a constant cycle of trade drama every month. Trudeau also mentioned that he foresees a prolonged trade conflict. After a colorful conversation with Trump, he noted that both countries are actively discussing ways to minimize the negative impact of these tariffs on workers and industries in Canada.
Trump recently initiated new tariffs against Canada, Mexico, and China, prompting swift retaliation from these nations. As of now, a 25% tariff applies mainly to Mexican and Canadian imports, though Canadian energy is subject to a lower 10% tariff.
During a recent interview, Lutnick indicated that the exemptions will likely extend beyond just automobiles to cover a broader range of goods and services under the United States-Mexico-Canada Agreement (USMCA). This agreement has replaced NAFTA and is crucial for many businesses that rely on cross-border trade.
Trudeau welcomed the potential for these delays but remains cautious. He stated, “For now, tariffs remain, and so do our retaliatory measures.”
In the wake of these tariffs, Canada has imposed about $30 billion Canadian (around $21 billion in U.S. dollars) in retaliatory tariffs on various American products, including orange juice and motorcycles. Ottawa plans to introduce an additional $125 billion (approximately $87 billion USD) in tariffs in the near future on goods like electric vehicles, fruits, and electronics.
Despite Trump’s assertion that the U.S. doesn’t rely on Canada, it is worth noting that a significant portion of American oil and energy imports comes from Canada. Approximately 25% of U.S. oil and 85% of electricity imports hail from the northern neighbor.
Canada also plays a vital role as a supplier of critical materials to the U.S., such as steel, aluminum, and uranium. With strong trade ties—nearly $3.6 billion Canadian (around $2.7 billion USD) in goods and services crossing the border daily—Canada remains a crucial partner to the U.S., particularly for 36 states.
In response to ongoing trade tensions, Canadian provinces are looking to strengthen interprovincial trade to reduce dependency on the U.S. and bolster their economies.
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