Washington plans new tariffs on Canadian goods as Ottawa vows dollar-for-dollar retaliation, raising concerns over trade costs and supply chains.

WASHINGTON: The United States and Canada failed to reach a trade agreement on Friday, prompting the White House to announce plans to impose 50% tariffs on certain imports from Canada.

Canadian Prime Minister Mark Carney said Canada would retaliate against the new US tariffs, pledging to match the measures dollar for dollar to protect Canadian workers and businesses.

Carney said Canada had suspended trade negotiations with the United States and recalled its negotiators to Ottawa after last-minute changes proposed by Washington were deemed “unfair” and “uneconomic”.

The Canadian prime minister said the proposed changes also raised questions about the reliability of any potential trade agreement between the two countries.

The United States intends to impose a 50% tariff on around $20 billion worth of Canadian goods starting at midnight. Carney said Canada would respond with equivalent tariffs on the affected US imports.

The latest development represents a setback to efforts by Washington and Ottawa to resolve their trade differences and establish more predictable trading conditions.

The tariff dispute could increase costs for businesses on both sides of the border and disrupt supply chains involving Canadian and US manufacturers, exporters and suppliers.

Canada and the United States have extensive economic ties, with businesses in both countries relying heavily on cross-border trade. The escalation therefore risks creating additional uncertainty for companies and workers as both governments consider their next steps.