Canada will remove its retaliatory tariffs on a long list of US products that comply with the existing North American trade deal, seeking to lower tensions with the White House.
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Prime Minister Mark Carney announced the decision on Friday after a meeting with his cabinet.
The government is changing its tariff policy to align more closely with US measures. That means a broad range of US-made consumer products will no longer face a 25 per cent tariff when imported into Canada, as of September 1, as long as they’re shipped in compliance with the provisions of the US-Mexico-Canada Agreement.
But Canada is keeping 25 per cent import taxes on US steel and aluminium, as well as tariffs on US cars and trucks. US President Donald Trump has imposed levies on all of those sectors.
Carney indicated the move is meant to prepare the ground for the review of USMCA, which is expected to begin in the coming months.
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It is a major policy shift for Canada, which was one of the only countries to swiftly retaliate against US protectionism – something that irritated Trump and Commerce Secretary Howard Lutnick. It comes a day after Carney and Trump spoke by phone, their first publicly acknowledged conversation in weeks.