U.S. President Donald Trump said Thursday he is again pausing his tariffs on some Canadian goods, offering the country yet another roughly month-long reprieve from a punishing 25 per cent levy.
Trump’s actions are a welcome development for the country, given just how damaging tariffs that big could be for the economy.
But the events of the last week show what Canada is in for over the next nearly four years: chaos, unpredictability and constantly moving goal posts from a White House that doesn’t play by normal trade rules.
Even in announcing this supposed pause, a White House official told some American news outlets on a background briefing that the tariff reprieve would only apply to Canadian exports that are compliant with the Canada-U.S.-Mexico Agreement (CUSMA) — and not goods that are sold into the U.S. outside of that trade deal.
The Associated Press reported that roughly 62 per cent of imports from Canada would likely still face the 25 per cent tariffs because they’re not “USMCA compliant,” according to a White House official who insisted on anonymity to preview the orders on a call with reporters.
Canadian officials did not immediately respond to a request for comment on the White House’s assertions.
While Canada is getting at least a temporary break from a universal tariff that was supposedly tied to fentanyl and the border, Trump said Thursday he is pressing ahead with a previously announced 25 per cent tariff on all steel and aluminum imports next week. Canada is the leading exporter of both metals to the U.S.
Those more targeted tariffs are still a major concern for Canada, given the last time Trump imposed similar tariffs on those metals there was a huge drop in Canadian exports, threatening jobs and businesses. According to Statistics Canada data, aluminum exports dropped by roughly half in 2019 as a result of Trump’s trade action in his first term.
Trump also signalled there is trouble on the horizon for Canada’s auto sector, which got a reprieve from Trump’s tariffs yesterday.
Trump said there will be no exemptions for Canadian and Mexican autos next month when he goes ahead with what he’s calling “reciprocal” tariffs on countries that supposedly rip off the U.S.
Below is an earlier version of this story.
Prime Minister Justin Trudeau said on Thursday that his phone call with U.S. President Donald Trump was “colourful” with moments of tension as the two hashed out how to bring the American-led trade war to an end.
Trudeau said negotiations are underway to secure some form of tariff relief for certain sectors, but warned there’s no sign that Trump is willing to drop his levies entirely and it’s likely a trade dispute will continue “for the foreseeable future.”
