Canadian Prime Minister Mark Carney has announced that Ottawa will remove its counter-tariffs on US goods covered under the Canada-US-Mexico Agreement (CUSMA), beginning 1 September. The move marks a partial easing of the trade tensions between the two neighbours, though Canada will continue to maintain duties on steel, aluminium and automobiles until a broader resolution is reached.
The announcement, published on the prime minister’s official website on Friday, came a day after Carney held a phone call with US President Donald Trump. The two leaders discussed ongoing trade challenges, opportunities for economic cooperation and shared priorities in strengthening bilateral security and economic ties.
“Canada will retain our tariffs on steel, aluminum and autos as we work intensively with the US to resolve the issues there,” Carney said in the statement. He added that the decision to lift duties on certain goods is intended to align with exemptions already applied by Washington under CUSMA.
Canada and the US have been locked in a bitter trade dispute since February, when the Trump administration imposed sweeping tariffs on Canadian products. Ottawa retaliated by levying a 25 per cent duty on approximately C$30 billion (£16bn; $21.7bn) worth of US exports, hitting goods ranging from orange juice to washing machines.
The latest development effectively creates a carve-out for CUSMA-compliant goods, but trade friction remains high. As of August, US tariffs still amount to 35 per cent on Canadian goods outside the free trade framework. Canadian officials said they are determined to continue negotiations with Washington to achieve a fair settlement on remaining disputes.
The decision comes amid heightened concern over the economic fallout of escalating tariffs on both sides, particularly in manufacturing and agriculture. Analysts say the partial rollback could help ease costs for Canadian consumers and businesses while signalling willingness to de-escalate tensions without weakening Canada’s stance on core industries such as steel and autos.
While the announcement represents progress, the path to fully restoring trade normalcy between the US and Canada remains uncertain, with both sides holding firm on key sectors central to their economies.
