based on the materials of the site -
By Coingabbar
Canada announced the imminent repeal of American tariffs on American goods worth billions of dollars, imposed after the new Prime Minister Mark Carney changed trade policy. The government confirmed that American consumer goods worth $21.7 billion will no longer be subject to a 25% tariff, although tariffs on steel, aluminum, and automobiles will remain.
The decision was made shortly after a phone call between Carney and President Donald Trump. This heightened expectations for a less confrontational approach to trade as the United States prepares to revise the United States-Mexico-Canada Agreement (USMCA).
Notably, the repeal of tariffs applies to a wide range of American-made products, including orange juice, wine, clothing, and motorcycles. These products were subject to Canadian tariffs since March as part of Ottawa's retaliatory measures against Trump's protectionist trade policy.
According to sources, the measures to reduce tariffs only apply to goods shipped in accordance with the provisions of the USMCA.
Despite the repeal of tariffs on consumer goods, Canada decided to maintain tariffs on steel, aluminum, and automobiles. These sectors remain under tariffs due to previously imposed tariffs by Trump on Canadian exports.
This decision marks a significant shift in Carney's course, who promised during his election campaign to take retaliatory measures against American tariffs. His predecessor, Justin Trudeau, implemented the first package of retaliatory tariffs in March, affecting American supplies worth over $21 billion. Carney expanded these measures after taking office, especially regarding American-made automobiles.
However, since taking office, Carney has taken a more restrained position. His government began granting tariff exemptions as early as April, offering benefits to certain businesses and manufacturers.
Automakers such as General Motors and Stellantis were given the opportunity to receive tariff exemptions on the condition of maintaining production and investment in Canada. Although Carney threatened to raise import tariffs in the U.S. in response to Trump's decision to double tariffs on steel and aluminum, he did not follow through.
Economists believe that Canada's softer approach reflects current economic realities. Nevertheless, in July, the consumer price index rose by 1.7% compared to the previous year, significantly below the Bank of Canada's inflation target of 2%.
This information suggests that retaliatory tariffs did not lead to an increase in inflation, as some observers had predicted.
Meanwhile, according to estimates from economists at the Bank of Nova Scotia, the effective U.S. tariff on Canadian products remained below 7% due to the exemptions provided under the Canada-United States-Mexico Agreement (USMCA).
These figures prompted Ottawa to focus on trade stability while maintaining protective measures for sectors deemed sensitive.
The repeal of tariffs on consumer goods is timely as both countries plan to review the USMCA, scheduled for the end of this year. Reports indicate that Canada is doing this to improve negotiation conditions and maintain influence on issues that still need resolution.
The Trump administration expressed concern about imports of steel, aluminum, and automobiles — sectors that Canada did not address in its latest statement.
Carney's administration has shown restraint in response to new U.S. tariffs, including the recent increase in tariffs on Canadian goods related to fentanyl trade by the White House.
A White House spokesperson described Canada's actions as long-awaited and overdue, confirming ongoing negotiations between the two countries. This statement marks one of the first notable changes in the tone of relations between Ottawa and Washington after several months of tense negotiations regarding American tariffs.
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