Canada to face a tariff of 35% on exports to the US, says Trump

LAST UPDATE | 10 hrs ago

CANADA WILL FACE a 35% tariff on exports to the United States starting 1 August, President Donald Trump said yesterday in a letter to Prime Minister Mark Carney.

It was the latest of more than 20 such letters issued by Trump since Monday, as he continues to pursue his trade war threats against dozens of economies.

Canada and the US have been locked in trade negotiations in hopes of reaching a deal by July 21, but the latest threat appeared to have shifted that deadline.

Both Canada and Mexico are trying to find ways to satisfy Trump so that the free trade deal uniting the three countries – known as the USMCA – can be put back on track.

“Throughout the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and businesses. We will continue to do so as we work towards the revised deadline of August 1,” Carney posted on social media platform X Thursday night.

The United States-Mexico-Canada Agreement replaced the previous NAFTA accord in July 2020, after Trump successfully pushed for a renegotiation during his first term in office.

It was due to be reviewed by July next year, but Trump has thrown the process into disarray by launching his trade wars after he took office in January.

Canadian and Mexican products were initially hard hit by 25% US tariffs, with a lower rate for Canadian energy.

Trump targeted both neighbors, saying they did not do enough on illegal immigration and the flow of illicit drugs across borders.

But he eventually announced exemptions for goods entering his country under the USMCA, covering large swaths of products.

The letter on Thursday came despite what had been warming relations between Trump and Carney, who has been faced with his counterpart’s regular musings that Canada should become the 51st US state.

Reciprocity

The Canadian leader came to the White House on 6 May and had a cordial meeting with Trump in the Oval Office.

They met again at the G7 summit last month in Canada, where leaders pushed Trump to back away from his punishing trade war.

Canada also agreed to rescind taxes impacting US tech firms that had prompted Trump to retaliate by calling off trade talks.

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Separately, Trump announced in an interview with NBC that he was also thinking of slapping blanket tariffs of between 15 and 20 percent on August 1 on countries that had not yet received one of his letters.

The letters announce tariff rates of as much as 50% in the case of Brazil to kick in on August 1 unless better terms can be found before then.

Trump told NBC that the letter to the 27-country European Union, the US’s biggest trading partner, would be sent “today or tomorrow (Friday).”

Brazilian President Luiz Inácio Lula da Silva said yesterday that he is willing to negotiate with the United States after Trump said he would hit the country with his tough tariff.

He however reiterated that the Brazilian government is evaluating reciprocity measures.

In his letter addressed to Lula, Trump criticised the treatment of his right-wing ally Jair Bolsonaro.

Texas

Amidst the tariff talk, Trump is set to visit Texas today as questions mounted over the response to flash floods that have left at least 120 people dead, including dozens of children.

The Republican leader and First Lady Melania Trump will meet first responders and local officials in central Texas’s Hill Country, a week after heavy rainfall and an overflowing river swept away houses, trees, cars and people.

They are due around midday in Kerrville, a city in the worst-affected Kerr County where at least 96 people died.

“I would have done it today, but we’d just be in their way,” Trump told reporters when asked on Sunday about visiting the impacted communities.

The urgent search for more than 170 missing people, including five girls who were at summer camp, entered the eighth day as rescue teams combed through mounds of debris and mud.

But with no live rescues reported this week, worries have swelled that the death toll could still rise.

Trump has brushed off questions about the impact of his cuts to federal agencies on the response to the flood, which he described as a “100-year catastrophe” that “nobody expected.”

Yesterday, Homeland Security Department head Kristi Noem defended the immediate response as “swift and efficient.”

But she previously said Trump wanted to “upgrade the technologies” of the “ancient” weather warning system.