US President Donald Trump stepped up his tariff attack on Canada on Thursday, saying the United States would impose a 35 percent tariff on imports next month and planned to impose general tariffs of 15 percent or 20 percent on most other trading partners, Reuters reported.
In a letter posted on his social media platform, Trump told Canadian Prime Minister Mark Carney that the new rate would take effect on August 1 and would increase if Canada retaliated.
In a post on social media late Thursday, Carney said his government would continue to defend Canadian workers and businesses in their negotiations with the U.S. as they work to meet that deadline.
The 35 percent tariff is an increase from the current 25 percent rate Trump has imposed on Canada and is a blow to Carney, who has been trying to negotiate a trade deal with Washington, according to Reuters.
The exemption for goods covered by the United States-Mexico-Canada Agreement (USMCA) was expected to remain in place, and the 10 percent tariffs on energy and fertilizer were also expected to remain unchanged, although Trump has not made a final decision on those issues, an administration official said.
In his letter, Trump complained about what he called the flow of fentanyl from Canada, as well as the country's tariff and non-tariff trade barriers that hurt American dairy farmers and others. He said the trade deficit posed a threat to the American economy and national security.
"If Canada cooperates with me to stop the flow of fentanyl, we may consider amending this letter," Trump wrote.
Canadian officials say a minimal amount of fentanyl originates in Canada, but that they have taken measures to strengthen the border.
"Canada has made vital progress in stopping the scourge of fentanyl in North America. We are committed to continuing to work with the U.S. to save lives and protect communities in both our countries," Carney added in his post on Network X late Tuesday.
The Canadian prime minister said last month that he and Trump had agreed to conclude a new economic and security agreement within 30 days.
Trump has expanded his trade war in recent days, imposing new tariffs on a number of countries, including allies Japan and South Korea, along with a 50 percent tariff on copper.
His latest barrage of moves has again unsettled investors, with US and European stock futures falling in Asia on Friday as markets nervously await news of what tariff Trump will impose on the European Union (EU) later today.
"A potential escalation between the EU and the US is a big deal for financial markets. If you get something like (the US-China trade war in April), it will be very destabilizing," said Joseph Capurso, head of international economics at the Commonwealth Bank of Australia.
In an interview with NBC News released Thursday, Trump said other trading partners who have not yet received such letters will likely face blanket tariffs.
"Not everyone has to get a letter. You know that. We just set our tariffs. We're just going to say that all the remaining countries will pay, whether it's 20 percent or 15 percent. We'll take care of that now," Trump said in an interview.
Myanmar's ruling military general has asked Trump to reduce the 40 percent tariff on his country's exports to the United States to 10-20 percent and is ready to send a negotiating team to Washington if necessary, state media reported today.
The Philippine president will meet Trump for the first time in Washington this month and discuss the 20 percent tariff, the country's foreign minister said.
Canada is the US's second-largest trading partner after Mexico and the largest buyer of US exports. Last year, it bought $349,4 billion worth of American goods and exported $412,7 billion worth of goods to the US, according to the US Census Bureau.
Carney, who led his Liberal Party to election victory earlier this year on a promise to address trade challenges with the US, had aimed to negotiate a trade deal with its key trading partner by July 21.
Trump did not specify in his letter how trade negotiations were progressing, but said that "tariffs may be modified, up or down, depending on our relationship with your country."
Last month, Carney's government abandoned a planned digital services tax targeting US technology firms after Trump abruptly canceled trade talks, saying the tax was an "open attack."
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