Canada braces for 50% US tariffs as talks remain far apart

Canada braces for a new round of 50 percent US tariffs starting this week, a move that could cause job losses in some industries and complicate negotiations over North America's free trade agreement. President Donald Trump invoked Section 338 of the Tariff Act of 1930 to impose these duties on Canadian imports, including wine, furniture, dairy products, cement, clothing, fishing rods, and hockey equipment.

This unprecedented use of the power is part of Trump's hardline trade approach since he returned to the presidency last year. Canada, the United States' second-largest trading partner, stands to lose nearly $20 billion worth of goods, accounting for about 5.2 percent of the $383 billion in US imports from Canada in 2025. Despite ongoing talks between Canada and the US, the two nations remain far from reaching a draft trade deal.

Canada's chief trade negotiator, Janice Charette, and US Trade Representative Jamie Dimon have been meeting regularly, but the tariffs are expected to add to the trade uncertainty and pose a risk to sectors such as the wood product and wine industries. Small and medium-sized businesses could face significant challenges due to the tariffs, as they heavily rely on tariff-free access to US customers.