Carney Rejects US Trade Deal, Imposes Retaliatory Tariffs

Canada's Prime Minister Mark Carney has walked away from last-minute trade talks with the United States, setting the stage for a sharper economic confrontation with President Donald Trump. Carney has vowed to hit back dollar for dollar after Washington imposed 50% tariffs on $20 billion worth of Canadian goods.

The negotiations had appeared to be moving towards a deal only days earlier. However, Carney remained cautious, saying work still needed to be done. By the end of the week, the talks had collapsed.

Carney said the United States had introduced new demands as the negotiations neared their conclusion, including pressure on Canada to follow Washington's wishes on tariffs involving other countries. For Carney, that crossed a line. Canada will now impose retaliatory tariffs on American goods from September 8.

The decision carries serious risks for Canada's economy, which is deeply tied to that of the United States and relies heavily on its southern neighbour for trade and defence. A prolonged tariff battle could hurt exporters, raise costs, and create more uncertainty for businesses already dealing with months of disruption.