Canada was quick to react to the move, with Prime Minister Mark Carney vowing to match the tariffs imposed by the Trump administration.

Updated on: Aug 22, 2026, 10:03:40 IST

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The US on Saturday imposed 50% tariffs on Canadian products worth $20 billion as talks between both sides failed. Canada was quick to react to the move, with Prime Minister Mark Carney vowing to match the tariffs imposed by the Trump administration.

The move comes after Trump said that the United States "should be able to have a deal with Canada," citing his "good relationship" with Carney.

US Trade Representative Jamieson Greer on Friday said that "Canada declined to finalize the trade deal under the terms agreed earlier this week," news agency AFP reported.

He also said Canada declined despite Washington’s offers to reduce tariffs on sectors such as steel and aluminium.

'Terms were unfair'

Carney responded, “Last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal.”

He said his government would announce additional support for Canadian workers and businesses in the coming days.

Canada has been seeking relief from US tariffs on automobiles, steel and aluminium, which have weighed on its economy, contributed to job losses and strained its once-strong trading relationship with Washington.

Carney has repeatedly warned Canadians that ties with the United States have undergone a lasting change, irrespective of the outcome of any individual trade agreement.

He also said the country must diversify and reduce its reliance on the United States, which currently accounts for roughly 70 percent of Canadian exports.

Political impact

The political repercussions of the tariff dispute could prove even more significant than its economic impact, given that the two countries exchanged $880 billion worth of goods and services last year.

The tariffs were originally scheduled to take effect at 12:01 a.m. Wednesday. Trump, however, extended the deadline by three days to give the two sides more time to negotiate, news agency AP reported.

Despite the extension, they failed to reach an agreement.

The US and Canada have had trade disputes for decades, including disagreements over Canadian softwood lumber imports and US access to Canada’s protected dairy market.

Despite these tensions, the two countries have maintained close ties as allies, neighbours and major trading partners. Canadian troops fought alongside US forces in Afghanistan following the September 11 attacks.

Their 5,525-mile border remains undefended, while nearly 330,000 people and goods worth around $2 billion cross the border every day. About 800,000 Canadians also live in the United States.

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