WASHINGTON: The United States has sharply escalated its trade dispute with Canada, announcing new import restrictions on a wide range of Canadian products, including alcoholic beverages, motorcycles and dairy goods.
The new US measures will take effect on September 29, according to notices published on the White House website. They came after Canada’s retaliatory tariffs on US goods took effect earlier Tuesday.
The latest escalation follows several rounds of failed trade negotiations between the two longtime allies. Last month, Washington imposed 50% tariffs on about $20 billion worth of Canadian goods, prompting Ottawa to retaliate.
The US restrictions cover a broad range of alcoholic products, including beer, wine, whisky, bourbon, rum, vodka, tequila, mezcal and brandy. Certain dairy products, whey protein, molasses and non-alcoholic beer are also affected.
Washington has additionally placed various cheese products under a 50% tariff rather than banning them outright. Paper, aluminum, wood, furniture, lighting and other Canadian products have also been added to the tariff list.
Canadian Prime Minister Mark Carney said the dispute underlined the need for Canada to reduce its dependence on the US market.
“We have everything we need to pivot and prosper,” Carney said, arguing that while diversifying Canada’s economy would carry costs, remaining heavily dependent on the US could be even more costly.
Ottawa strikes back
Canada’s retaliatory tariffs cover around $20 billion of US goods, with duties ranging from 15% to 50%. They target products including steel, furniture, clothing and electronics.
Canadian officials say the measures are designed to pressure Washington while protecting Canadian workers, farmers and businesses.
US Trade Representative Jamieson Greer and Canadian minister Dominic LeBlanc have held talks on finding a way forward, with further discussions expected.
Despite the dispute, the two economies remain deeply connected. Canada has sent nearly 68% of its total exports to the US this year, with roughly 80% of those shipments moving duty-free under the US-Mexico-Canada Agreement (USMCA).
USMCA under pressure
The escalating trade war is raising concerns about the future of the USMCA, the agreement that replaced NAFTA and has supported North American trade for decades.
US President Donald Trump has also threatened to raise tariffs on Canadian automobiles and parts from 25% to 50% starting January 1.
The growing confrontation could disrupt supply chains, increase costs for businesses and consumers and further strain relations between two economies that have long been closely integrated.
