Canadian Prime Minister Mark Carney has stated that the long-standing relationship between Canada and the United States, characterized by deep economic integration and strong military cooperation, “is over.”
Carney’s remarks followed a cabinet meeting in Ottawa, where he emphasized the need for Canada to “fundamentally reimagine our economy” in response to US President Donald Trump’s newly imposed tariffs.
The Canadian government is set to retaliate with its own tariffs, which Carney insists will be designed to have a “maximum impact” on the US economy. Trump’s recent announcement of a 25% tax on imported vehicles and vehicle parts, described as a “permanent” measure, has prompted a strong response from Canada. Carney, the Liberal Party leader, called the 1965 Canada-US Automotive Products Agreement the most significant deal in his lifetime, stating: “That’s finished with these tariffs.”
Carney went on to say that Canada could still sustain its auto industry despite the US tariffs, provided that both the government and business community collaborate to “reimagine” and “retool” the sector. He highlighted the importance of building an economy that Canadians can control, which could involve reevaluating trade relationships with other global partners.
The future of Canada’s trade relations with the US remains uncertain, Carney noted, adding that the situation would influence his upcoming campaign ahead of next month’s general election. The US has already imposed a 25% tariff on a wide range of Canadian goods, along with duties on aluminium and steel imports. In retaliation, Canada has placed tariffs on US goods worth about C$60bn ($42bn).
The new car tariffs will come into effect on April 2, with charges on businesses importing vehicles to begin the following day. Taxes on parts will be implemented by May. On Thursday, Trump warned Canada and the EU against forming an alliance against the US in the trade war, saying on Truth Social: “If the European Union works with Canada in order to do economic harm to the USA, large scale Tariffs, far larger than currently planned, will be placed on them both.”
Carney, who was initially scheduled to campaign in Quebec, met with his ministers in Ottawa on Thursday to “discuss trade options.” He confirmed that President Trump had reached out for a phone call, expected to take place in the next couple of days, marking the first direct communication between the two.
Pierre Poilievre, leader of the Conservative Party, condemned the tariffs as “unjustified and unprovoked.” Meanwhile, Jagmeet Singh, leader of the NDP, expressed outrage, calling the tariffs a “betrayal” by the US, and described them as an “illegal trade war with Canada.” Singh further stated that any auto company relocating operations out of Canada due to the tariffs should be banned from selling cars in the country.
The Canadian general election will take place on April 28.
