Summary
Canada announced that it will remove many of its retaliatory tariffs to align with U.S. tariff exemptions under the United States-Mexico-Canada trade pact (USMCA). Prime Minister Mark Carney believes this will improve trade talks with the U.S. even as some Canadian leaders express concerns. The USMCA agreement exempts most goods from tariffs, benefiting the trade relations of the involved countries.
Key Facts
- Canada will drop retaliatory tariffs to align with U.S. exemptions under the USMCA.
- The USMCA shields most goods from tariffs, maintaining free trade for over 85% of Canada-U.S. trade.
- Canada imposed 25% tariffs on various U.S. goods in response to earlier U.S. tariffs but now plans to ease them.
- The agreement is set for review in 2026, and further trade negotiations are expected.
- U.S. President Donald Trump has considered renegotiating USMCA, and sector-specific tariffs such as steel and aluminum still apply.
- Over 75% of Canada’s exports go to the U.S., showing the importance of the trade relationship.
- Prime Minister Carney discussed trade issues with President Trump and stressed preparations for future trade agreement reviews.
