Canada Slaps US with $20 Billion in Tariffs as Trade War Escalates

Canada has imposed tariffs of up to 50% on about $20 billion worth of U.S. goods in response to U.S. tariffs on Canadian products, escalating a trade war that is raising costs and testing a relationship between two of the world's closest allies.

The latest measures match U.S. tariffs dollar for dollar, though not product for product. The move has led to a 22% fall in U.S. auto exports to Canada since the trade dispute began. Canadian Prime Minister Justin Trudeau's government has imposed the tariffs in an effort to protect its economy and industries.

Former Canadian Finance Minister Chrystia Freeland, who helped negotiate the USMCA agreement during Trump's first term, believes that the U.S. risks pushing longtime allies away with its aggressive trade tactics. 'If Americans are concerned about China in the world, which I am, the best way to act on China is with an alliance with America's traditional allies,' Freeland said.

Freeland also pushed back on the idea that Canada's smaller economy means it ultimately has to give in. She recalled a meeting during earlier trade negotiations where she was told the U.S. was 10 times bigger than Canada and therefore 'should get our way 10 times more than you.' 'That is not a way to have a partnership,' Freeland said.