President Donald Trump has unveiled a sweeping 35 percent tariff on Canadian exports, effective August 1, adding to a growing list of countries facing new U.S. trade barriers. The announcement was delivered in a letter to Canadian Prime Minister Mark Carney, one of more than 20 such letters sent to world leaders this week.
The timing of the tariff coincides with ongoing negotiations between Canada and the U.S., aimed at updating the USMCA trade agreement. The new tariff threat has shifted the negotiation timeline, with both Canada and Mexico working to address U.S. concerns.
Carney publicly affirmed Canada’s commitment to defending its workers and businesses, emphasizing efforts to reach a resolution before the revised deadline. The USMCA, which replaced NAFTA, was already scheduled for review next year, but Trump’s actions have introduced significant uncertainty.
While the U.S. administration points to issues like illegal immigration and fentanyl trafficking as justification, official data shows Canada’s contribution to the U.S. fentanyl supply is minimal. Exemptions for certain goods under the USMCA are expected to remain.
Trump’s tariff threats are not limited to North America, with similar actions targeting the European Union and Brazil, the latter potentially facing a 50 percent tariff unless negotiations succeed. The global business community is watching closely as the August 1 deadline approaches.