Canada has announced a significant escalation in its trade response to recent US tariffs on steel and aluminium. In a move that marks a deepening of the trade conflict, Canada will impose C$29.8 billion ($32.8 billion) in retaliatory tariffs against American imports. This comes on the heels of US President Donald Trump's decision to enforce a 25 per cent tariff on all foreign imports of these metals into the United States.
President Trump had previously floated the idea of Canada joining the United States as its fifty-first state, adding a layer of complexity to the already tense trade relationship. The new tariffs from Canada specifically target $13.9 billion worth of steel products and $3.3 billion worth of aluminium products from the US. In addition, $15.6 billion of other American goods, including computers and sports equipment, will face increased import duties.
International Reactions to Trump's Tariffs
The global response to President Trump's tariffs has been varied. While Canada is taking decisive action, other nations have yet to implement counter-measures. Australia, seeking an exemption from these tariffs, was not granted relief, prompting Prime Minister Anthony Albanese to label the decision as unfriendly. Similarly, the UK expressed disappointment over the situation but stopped short of announcing retaliatory tariffs. British Prime Minister Keir Starmer noted his dissatisfaction but did not escalate with reciprocal measures.
Meanwhile, Mexico has indicated a delay in its response strategy. President Claudia Sheinbaum announced that Mexico would hold off on imposing counter-tariffs until at least April 2. This measured approach contrasts sharply with Canada's immediate retaliatory measures.
The European Union Joins the Fray
The European Union has also entered the fray, announcing its own set of countermeasures against the United States. In response to the US tariffs on steel and aluminium, the EU will levy $45 billion in tariffs against various US industries. This move underscores the growing international dissent against the US administration's trade policies.
The backdrop to these developments includes President Trump's brief announcement — and subsequent retraction — of doubling tariffs on Canadian steel and aluminium imports to 50 per cent. This erratic policy decision further complicated the trade landscape, prompting Canada to take concrete steps in defense of its economic interests.
The Path Ahead for Global Trade
As tensions mount, Canada's role as the largest foreign supplier of steel and aluminium to the US becomes increasingly critical. The situation remains fluid as countries weigh their options in responding to US trade policies. While some nations adopt a wait-and-see approach, others like Canada and the EU assertively counteract with substantial tariffs of their own.
