The United States is threatening to impose new 50 per cent tariffs on many Canadian products, a move that experts say is part of a broader strategy to gain leverage ahead of negotiations over the Canada-U.S.-Mexico Agreement (CUSMA).
The tariffs, announced by U.S. President Donald Trump on Monday, are scheduled to take effect on Aug. 19. They would apply to nearly $20 billion US worth of Canadian exports, including dairy products, wine, whisky, hockey equipment and hundreds of other goods.
The White House says the tariffs are a response to several Canadian trade policies, including provincial bans on U.S. alcohol, increased access for European dairy products and limits on some U.S. vehicle exports.
Former Trudeau adviser Brian Clow said the move is serious but not unexpected. He said Canada should avoid rushing into a response and use the next 30 days to carefully consider its options.
Some major Canadian exports, including crude oil, potash and critical minerals, would be exempt. Analysts say those products were likely left off the list to avoid raising U.S. fuel prices or disrupting supplies of fertilizer and key industrial materials.
The proposed tariffs would also remove the exemption currently enjoyed by most CUSMA-compliant Canadian goods, making the trade measures much broader than existing U.S. tariffs.
Trump is using a section of a U.S. trade law that has never been used before by a president. While he has threatened Canada with new tariffs several times over the past year, this is the first time the plan has been issued through official White House proclamations.
