Canada Announces Over $20 Billion in Retaliatory Tariffs on U.S. Goods

What Happened?

Canada announced new trade duties Wednesday in response to President Donald Trump's tariff moves on Canadian steel and aluminum imports.

More than $20 billion worth of U.S. goods will reportedly be impacted by Canada's retaliatory duties.

President Trump brought the total duties on Canadian steel and aluminum imports to 25%.

He revised plans of imposing 50% which brought concern for the Canadian auto industry.

During a news conference Wednesday, Canadian government spokesman Dominic LeBlanc called Trump's tariffs 'completely unjustified, unfair and unreasonable.'

François-Philippe Champagne, Canada's minister of innovation, science and industry said, 'The U.S. administration is once again inserting disruption and disorder into an incredibly successful trading partnership.'

Canada's announcement comes despite reaching a deal Tuesday with the Trump administration to resolve threats of a 25% surcharge on U.S. electricity exports.

The measure swiftly ended in a joint statement from Ontario's premier and U.S. commerce secretary as both parties agreed to negotiate in Washington DC sometime this week.

Trump criticized Canada for 'stooping so low' to use electricity as a threat and bargaining chip.

The Dow Jones Industrial Average fell into negative territory Wednesday following the retaliatory measure as inflation worries grow.

Why it Matters

Canada is reportedly the largest foreign supplier of steel and aluminum to the U.S.

The country's retaliatory measures follow suit with the European Union (EU), which announced duties on U.S. goods worth $28 billion.

Those measures include products like beef, peanut butter, bourbon, home appliances, jeans, and even motorcycles alongside American-made steel and aluminum.

Trump has stated he would 'substantially increase' tariffs on Canadian automobile parts on April 2 if Ottawa's longtime measures impacting U.S. farmers are not addressed.

He warned that America would match those dairy tariffs dollar-for-dollar.

Trump has provided a one-month exemption on various Mexican tariffs in compliance with the United States-Mexico-Canada Trade Agreement (USMCA).

China has already implemented retaliatory measures on U.S. farm exports amid 20% tariffs imposed by Trump on Chinese imports.

U.S. stocks have been rocky this week amid the Trump administration's ongoing tariff disruption that threatens a trade war.

The president wouldn't rule out the possibility of a recession during his Fox News interview that aired Sunday.

Some economists have raised the expectations of a recession within the next 12 months as high as 40%, citing these trade policy changes.

How it Affects You

A recession in 2025 hangs in the balance for Canada should the U.S. carry out broader 25% tariff measures on Canadian imports.

Trump has stated his tariff policies would cause 'a little disturbance' as American consumers worry about a sharp rise in price inflation.

It will be key to see if Canada and the U.S. can get on reasonable terms while the Trump administration addresses a historic trade deficit.