Canada warns Trump on tariffs: Retaliation is coming April 2

(CNN) — Canadian Prime Minister Mark Carney told President Donald Trump Friday that his nation will retaliate against the United States with tariffs of its own if Trump presses forward with his promised levies – potentially escalating what is already developing into an ugly and damaging trade war. Trump responded that he’s open to deals – but potentially after his tariffs go into effect.

The leaders of the bordering nations spoke Friday before the White House’s expected tariffs go into place April 2 – a day Trump has been calling America’s “Liberation Day.” The call came a couple days after Trump announced new tariffs on automobiles and parts on Wednesday, upending decades of free trade between the nations.

In a statement Friday, Carney’s office said Canada plans to implement retaliatory tariffs on US goods next week in response to Trump’s promised import taxes. But Carney offered no specifics – including timing and the scope of the retaliatory tariffs.

“The Prime Minister informed the President that his government will implement retaliatory tariffs to protect Canadian workers and our economy, following the announcement of additional U.S. trade actions on April 2, 2025,” the Prime Minister’s Office said in a press release.

Still, Carney and Trump sounded a hopeful note after the call – a noticeable change in tone from the fractious relationship between former Prime Minister Justin Trudeau and Trump.

Friday’s call was the first between the two leaders. Carney’s office described it as a “very constructive conversation,” and Trump said in a social media post that the call was “extremely productive.”

“The leaders agreed to begin comprehensive negotiations about a new economic and security relationship immediately following the election,” the statement said, referring to Canada’s federal election scheduled for April 28.

In the interim, ministerial-level talks around trade are expected to “intensify to address immediate concerns,” the statement added.

Nevertheless, Carney warned yesterday that Canada’s relationship with the United States had fundamentally changed given the Trump administrations’ tariff threats and said Canada has “a number of measures that we can take in response.”

Trump says he’s open to deals

Trump, speaking to reporters on Air Force One Friday, expressed some openness to cutting tariff deals with other countries as he plans to unveil a significant batch of reciprocal tariffs in the coming days. But he suggested that any deals would be made after they go into place.

“Well it’s possible if we can get something for the deal – but, you know, we’ve been taken advantage of for 40 years, maybe more, it’s just not going to happen anymore. But yeah, I’m certainly open to it,” Trump said when asked if he was open to making deals with countries like the United Kingdom that have discussed reducing tariffs on the US.

Pressed on whether that would happen before the tariffs are announced, he said, “No. Probably later.”

Trump also reiterated plans to announce pharmaceutical tariffs “soon.”

“We’ll be announcing it soon, but we have to bring pharmaceuticals, drugs and pharmaceuticals, back into our country,” he said.

Trump declined to provide a specific rate for those tariffs, but said it would be “enough to get the drugs and the pharmaceutical companies bringing their product into our country – we never want to have to rely on other countries, like we did during Covid.”

He downplayed a shift in tone regarding Canada following his Friday morning call with Prime Minister Mark Carney, saying, “I’ve always loved Canada and we had a very good conversation.”

Tariff escalation

Canada has already threatened and imposed a number of retaliatory measures against the United States.

When Trump temporarily imposed 25% across-the-board tariffs on almost all Canadian goods, Canada immediately placed a 25% tariff on more than $20 billion of US imports, including dairy products, meats, grains, wine, beer, apparel, footwear, motorcycles, cosmetics and certain pulp and paper products. Canada also threatened additional tariffs on $86.2 billion of goods in the future if the tariffs didn’t come off (they mostly did – at least until April 2).

“This is a very dumb thing to do,” said Trudeau on March 1, directing his remarks at Trump. “We two friends fighting is exactly what our opponents around the world want to see.”

Ontario Premier Doug Ford also imposed a 25% surcharge on electricity sent to New York, Minnesota and Michigan, which he estimated would add around “$100 per month to the bills of hardworking Americans.” Ford said if the tariffs didn’t come off, he wouldn’t hesitate to shut off all electricity Canada delivers to America.

Trump fired back, threatening a 50% tariff on Canadian steel and aluminum – up from the 25% tariff he imposed on March 12. Ford and Trump ultimately backed off their threats, and Ford dropped the surcharge.

But the escalation shows “there are no winners in a trade war,” as Canadian and Chinese leaders have repeatedly said during the tit-for-tat trade spat with the United States.

It’s unclear how the Trump administration might respond to retaliatory tariffs from Canada. He has threatened a tariff of up to 250% on Canadian dairy – a high but ultimately meaningless threat, because the United States imports very little dairy from its northern neighbor. But Trump has also said he would place significant tariffs on Canadian timber, which could do real damage to the price of lumber in the United States.

After the European Union retaliated against US steel and aluminum tariffs with retaliatory tariffs of its own, Trump threatened a 200% tariff on European alcohol. The EU has since delayed its retaliation, and Trump hasn’t followed through with his threat.

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