tariffs

Canada’s economy has rebounded sharply in the second quarter after six months of virtually no growth, aided by a strong jump in exports and solid domestic demand, though a new round of tariffs from the United States brings renewed uncertainty.

The economy grew at an annualised rate of 3.3 percent in the second quarter, the fastest rate since 2023, after a revised 0.3 percent increase in the first quarter, Statistics Canada said on Friday.

The upward revision to first-quarter growth means Canada was not in a technical recession, usually defined as two straight quarters of contraction.

Healthy domestic demand, led by consumer spending and business investment, signals the economy is slowly brushing off the impacts of more than 18 months of US import tariffs that upended North American supply chains and increased costs.

Renewed tariff dispute

A strong domestic consumption and expenditure pattern puts Canada on a firm footing to withstand a new 50 percent US import tariff that President Donald Trump imposed this week on $20bn of Canadian exports. Canada retaliated with its own countermeasures on US imports.

“It seems like households and businesses were beginning to find ways of navigating the trade-related uncertainty before the latest round of tariffs,” Royce Mendes, managing director and head of macro strategy at Desjardins, wrote in a note.

“While it helps that the economy was on stronger footing heading into August, the fresh wave of protectionism injects a significant amount of uncertainty into the outlook,” Mendes said.

Michael Davenport, senior Canada economist at Oxford Economics, said in a note to Al Jazeera that while the gross domestic product (GDP) growth was along expected lines, “the economy is set to slow in the coming quarters amid escalating US-Canada trade policy uncertainty, new bilateral tariffs, and a shrinking population”.

The Canadian dollar weakened slightly after the GDP data, with the loonie trading down 0.01 percent at 72.17 US cents.

On a quarterly basis, GDP grew 0.8 percent for the period ended June, from an upwardly revised 0.1 percent in the previous quarter.

Second-quarter annualised growth was higher than the Bank of Canada’s July forecast of 2.5 percent growth.

Higher exports were one of the main contributing factors for the second-quarter growth, with outbound shipments growing 3.6 percent, the biggest increase in over three years, Statistics Canada (StatsCan) said.

Stronger household spending

Final domestic demand, the sum of all consumption and capital spending and a crucial metric to assess domestic health, rebounded to 1 percent in the second quarter, from a minor contraction in the first quarter.

Domestic demand has been muted for several quarters as consumers and businesses remain cautious while Canada navigates its trade war with the US.

But household final consumption expenditure, the main indicator of consumer spending, rose 0.8 percent, its highest level in three quarters, highlighting stronger household spending. This was mainly driven by higher wages and government benefits, economists said.

Business investment, or business gross fixed capital formation, sprang to a solid 2.3 percent growth in the second quarter from a contraction of 1.3 percent, the first time in the last year and a half that business investment has expanded.

That growth was led by investment in both residential and non-residential structures, machinery and equipment, StatsCan said.

However, the general gross fixed capital formation, essentially government expenditure for creating assets, continued to decline with a second-quarter contraction of 2.9 percent, after shrinking 2.6 percent in the previous quarter.

On a month-to-month basis, GDP for June grew 0.3 percent against a forecast of 0.2 percent, and an advance indicator showed that the economy was largely flat in July, the statistics agency said.

TORONTO — Canada struck back at the United States on Tuesday with retaliatory tariffs on about $20 billion worth of American goods, including steel, dairy products, appliances and farm equipment, as the trade war between the once-friendly neighbors escalated sharply.

The tension threatened one of the world’s largest trading relationships. The new tariffs extended well beyond industrial goods, hitting everyday purchases such as seafood, cheese, clothing, cosmetics and toilet paper, with some facing duties as high as 50%.

“We did not choose this conflict, but when our economic integration is used as a weapon rather than the foundation for a win-win partnership, we need to stand up,” Finance Minister François-Philippe Champagne said in French, calling the situation “an unprecedented challenge imposed on Canada.”

Canada’s retaliation came after the Trump administration imposed 50% tariffs over the weekend on Canadian goods following the collapse of trade negotiations. Canadian Prime Minister Mark Carney accused Washington of trying to subordinate Canada and said U.S. demands during the failed talks showed that Americans wanted to “destroy our major industries.”

President Trump intensified the confrontation Monday, telling Canadian leaders to “fall in line” or face consequences “far WORSE” than existing tariffs and threatening new 50% tariffs on Canadian vehicles, auto parts and steel.

Trump added another provocation Tuesday, saying the United States was giving “serious consideration” to renaming Lake Ontario “Lake America” in a feud with Ontario Premier Doug Ford. Such a change would be reminiscent of the Republican president’s unilateral action last year by executive order to rename the Gulf of Mexico to the Gulf of America.

The tariffs will take effect Sept. 8 at rates of 15%, 25% and 50%, with Canada matching the corresponding U.S. tariff rate on more than 700 products such as pulp and paper and electronics. The tariffs on many American products would double from 25% to 50%, with the largest share of the new measures affecting steel and aluminum.

Canadian officials said the goal is not to raise revenue but to protect Canadian companies and reduce U.S. imports.

U.S. steel imports, for example, have already fallen 30% since Canada imposed a 25% tariff, and the new 50% rate is expected to cut them further, Canadian officials said.

Goods facing 50% tariffs include some steel and aluminum products, furniture and clothing. Appliances, dairy products including cheese, fish and seafood, and certain steel and aluminum derivatives will face 25% tariffs. Existing Canadian countertariffs on U.S. autos will remain in place.

Canada also announced a support package for workers and businesses affected by the dispute worth $7.5 billion in Canadian dollars ($5.4 billion in U.S. dollars).

Canadian officials acknowledged the counter tariffs will raise costs for some businesses and consumers but said they expect the overall economic effects to be moderate.

They said the government has provided more than $30 billion Canadian dollars (US$21.7 billion) in tariff-related support since the beginning of 2025 — far more than it has collected in retaliatory duties — as it tries to cushion the blow from the trade fight.

Canada and the United States have deeply integrated supply chains across autos, energy, agriculture and manufacturing, making a prolonged trade fight potentially costly for businesses and workers on both sides of the border.

Businesses and consumers are caught in the middle, facing uncertainty about how much prices may increase.

Michael Howard II, owner of a furniture business in Warren, Michigan, outside Detroit, said the tariffs will hamper the “ability for us to put food on the table for our family” and affect “the ability for us to give back to our community.”

Howard and his wife started their business a decade ago. They make and sell everything from dining room tables to bookcases.

“To say that we don’t need Canada is just disingenuous,” he said. “It’s dishonest. And it’s just absolutely not truthful. We need our neighbor, but also they need us.”

Carney said Monday that Canada may need to move away from matching U.S. tariffs dollar for dollar and instead use more targeted retaliation aimed at protecting Canadian workers and businesses.

“An attitude at the negotiation table that Canada is a subsidiary of the United States” is “not something we’re going to accept,” Carney said.

Carney was even more blunt in French.

“We learned during the negotiations that the Americans want to destroy our major industries, including autos, steel and aluminum,” Carney said. “That was one of the main reasons we said no. It was a bad deal.”

On Monday, Carney said U.S. negotiators had raised the discoverability of French-language content on streaming platforms, along with French-language labeling rules, as trade irritants. He rejected the idea that those protections were negotiable, saying in French: “For the Americans, questions about the French language, Quebec culture, francophone culture and Canadian culture are irritants. Here in Quebec, here in Canada, they are rights.”

In a social media post early Tuesday, Trump wrote: “I would never interfere with Canadians speaking French! In fact, I have never even thought of doing such a stupid thing. This lie was made up by a weak and ineffective Prime Minister in an attempt to gain political support, which he has totally lost, from the people of Quebec. I love French Canadians!”

Gillies writes for the Associated Press. AP writers Seung Min Kim in Washington and Mike Householder in Warren, Mich., contributed to this report.

Canada will unveil retaliatory tariffs against the U.S. on Tuesday as tensions escalated with President Donald Trump pressing the Canadian government to “fall in line,” while Prime Minister Mark Carney accused Washington of offering a bad deal.

Canadian officials, including Finance

Canada’s Prime Minister Mark Carney has announced retaliatory tariffs on the United States after Washington imposed a 50 percent levy on $20bn worth of Canadian goods.

Carney, speaking in Ottawa on Saturday, said the new Canadian tariffs would target US steel, dairy and electronics industries among others and take effect on September 8.

“Canada will match Washington’s new tariffs dollar for dollar in order to protect Canadian workers, farmers, families, and businesses,” Carney told reporters.

The announcement came after days of intense negotiations broke down late on Friday, worsening a delicate relationship between the longtime trade partners and allies.

US President Donald Trump’s new tariffs hit sectors including wine, furniture, dairy products, cement, clothing, fishing rods and hockey equipment, and cover some $20bn worth of goods, or 5.5 percent of Canadian exports to the US.

Carney said Trump set conditions that were ultimately unacceptable even though earlier talks had been positive.

“In recent days, the United States proposed new terms that were uneconomic, unfair and undermined the net benefits for Canada, and called into question the reliability of any deal,” Carney said, adding these demands included curtailing Canada’s ability to forge new trade deals.

“We cannot accept what they’ve offered, and we will not give what they’ve asked.”

He added that US negotiators also made unacceptable “threats” to the French language and “Quebec culture”, referring to the French-speaking province in eastern Canada.

No new talks planned

Carney is one of the few global leaders to retaliate against US tariffs and has pledged to forge new trade and military alliances, despite Canada’s dependence on the ‌US for nearly 70 percent of its exports.

Canada will impose tariffs on US steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics, along with some products the US previously targeted in Canada, Carney said from Ottawa’s Parliament building. The government will release details on its response in the coming days, he said.

Carney said Canada would announce support measures next week for industries hit ⁠by the new US duties, adding these measures could last years.

There was no immediate comment from the White House.

US Trade Representative Jamieson Greer told Fox News on Saturday that no new ⁠talks are planned with Canada.

“We’re moving forward with measures that respond to Canadian retaliation,” Greer said. “They’ve always had the best deal, and they still would have an even better deal, but they didn’t want that.”

The new US tariffs are expected to have a major impact on Canada’s economy.

“Costs are going to go up, prices are going to go up, unemployment is going to go up as well,” said Al Jazeera’s David Mercer, reporting from the Canadian city of Calgary. “And it’s been warned that business owners – small [and] medium-sized businesses – some of those will have to declare bankruptcy,” he said.

At the same time, Mercer said, Carney is selling the trade war as an opportunity for Canada to strengthen its trade relations with other countries.

“He’s been around the world, he’s been talking to countries in Asia, in Europe, shoring up new trade relationships, wanting to diversify Canada’s economy and Canada’s trade relationships with other countries around the world just to get away from that dependency that Canada has traditionally had on the United States,” he said.

Public opinion surveys in Canada show most Canadians back a “tougher approach” to the US in the trade talks. A poll by Leger last week said 56 percent of Canadians favoured a hard line and making no more concessions.

‘Bad deal’

Ontario Premier Doug Ford, one of the most vocal ⁠opponents of US tariffs, supported Carney’s decision to retaliate.

“I’m glad he didn’t sign that deal because it was a bad deal. It was a bad deal for Ontario. It was a bad deal for the auto sector, the steel sector, and manufacturing sector,” Ford told reporters on Saturday.

In Port Colborne, Ontario, resident Stuart Edwards said the trade war was going to “hurt everybody” and “it’s just sad”.

“We have a bully in Washington, and he’s just hitting us all with the big stick all the time,” he said. “And we’re not going to put up with it; Canada isn’t. We’ll fight back.”

But Pamela Coulis, from Fort Erie in Canada, was worried about rising prices.

“I think probably the gas will go up even more, and all products, from food to, I don’t know, wood, everything else,” she said.

Diamond Isinger, who served as a special adviser to former Canadian Prime Minister Justin Trudeau, said both countries will suffer from the trade war.

“It’s going to cause pain and challenge for Canadians and Americans alike, in terms of the actions that, unfortunately, the US has taken as well as Canada’s retaliation. But ultimately this was the way forward; this was the only realistic next step,” she said.

“Because the US administration responds best, of all the responses that they could have, to all the actions that a government like Canada could take, to strength,” Isinger added.

“So, we could not simply accept 50 percent tariffs going forward. We had to move forward with our own retaliatory package.”

In the US, the escalating trade war was met with anger by Democratic lawmakers and governors from border states including Minnesota, New York and Washington, who blamed Trump for triggering chaos that would raise costs for US businesses and families.

“Needlessly picking fights with our allies and raising prices here at home. That’s Trump’s economic policy in a nutshell,” New York Governor Kathy Hochul posted on X.

The Business Roundtable, a group of 200 chief executives of leading US corporations, also warned the new tariffs “risk raising costs for American businesses and families”, and urged both governments to resume negotiations.

Aug. 22 (UPI) — A 50% tariff on Canadian goods went into effect early Saturday after talks between the two countries collapsed.

Canadian Prime Minister Mark Carney walked away from the negotiations and said Canada would retaliate against the tariffs.

Negotiators had been in Washington, D.C., working with U.S. Trade Representative Jamieson Greer to try to come to an agreement. But just before the midnight deadline Friday, Carney released a statement on X announcing that there would be no deal.

“In recent weeks, we made important progress toward improving Canada’s position as having the best deal in the world with the U.S. However, that progress has not been enough to meet our objectives for Canadians. As a result this evening I have decided to suspend trade negotiations with the U.S. and have directed Canada’s negotiators to return to Ottawa,” Carney said in the statement.

“At midnight tonight, the U.S. intends to impose a 50% tariff on roughly $28 billion of Canadian goods. Canada will match those tariffs dollar for dollar to protect our workers and businesses,” Carney added.

Greer posted a statement on X saying, “Despite the U.S. offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk-backs of other commitments by Canada have upended the careful balance reached in the past days.”

“This is a missed opportunity for Canada to partner with the United States, which is the fastest growing economy in the G7,” Greer said.

President Donald Trump signed orders in July to add the new tariffs on goods, including cement, hockey sticks, beer, cheese and other items that would make up about 2% of the entire trade between the two countries.

They were set to take effect at 12:01 a.m. Wednesday, but Trump extended the deadline to Friday night. He announced on Truth Social about 90 minutes before the deadline, saying the two countries “have a DEAL!”

Carney responded on X: “Substantial progress has been made, although there is important work still to be done.”

Analysts have said this is bad news for the United States and Canada.

“Economically, [the new tariffs are] not that important – except that the relationship itself is extremely important,” said Mary Lovely, a senior fellow at the Peterson Institute for International Economics, a nonpartisan research organization, The Washington Post reported.

Candace Laing, CEO of the Canadian Chamber of Commerce, said it will hurt both countries economically.

“This will be a body blow to North American competitiveness in this self-defeating trade saga,” Laing said in a statement. “Americans will see their costs go up, and Canadians will see customers, investment and small businesses disappear.”

A fresh wave of US tariffs on a wide array of Canadian goods has come into effect as of midnight on Saturday after a last minute break down in trade talks.

Announcing the suspension of negotiations shortly before the Friday night deadline, Canadian Prime Minister Mark Carney said he would impose reciprocal tariffs on US goods “dollar for dollar”.

Carney said “last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal”.

Trade negotiators had been engaged in intense talks since July, after President Donald Trump threatened to impose a 50% levy on nearly $20bn (C$28bn) of Canadian imports by 19 August.

Trump had temporarily paused those tariffs earlier in the week, saying the two sides were close to signing a trade deal that was “very good” for both countries.

But minutes before a deadline for a deal, Carney said that while “important progress” had been made in the talks it was “not enough to meet our objectives for Canadians”.

“As a result, this evening, I have decided to suspend trade negotiations with the U.S. and have directed negotiators to return to Ottawa,” he said.

“Last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal.”

After Carney’s announcement US trade representative Jamieson Greer said in a statement: “Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week.

“Despite the US offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk backs of other commitments by Canada have upended the careful balance reached in the past days,” the statement on X said.

The breakdown in talks marks a significant shift in tone from earlier in the week, when both US and Canadian officials sounded optimistic that a trade deal beneficial for both countries was within reach.

Negotiators were reportedly discussing a deal that would reduce US tariffs on Canadian steel and aluminium from 50% to 25%, and on Canadian autos from 25% to 15%.

In exchange, Carney had asked Canadian provinces to restore US alcohol to store shelves.

Tensions between the two major trading partners have been simmering since Trump returned to office in January last year and unleashed a wide-ranging global programme of tariffs, upending decades of free trade between Canada and the US.

Now that talks have broken down, Canada will be hit with new 50% US tariffs imposed by Trump using a Depression-era law called the Tariff Act of 1930.

They will be applied on a range of goods, including wine, dairy, cement, clothing and hockey equipment.

They are in addition to existing tariffs the US had already imposed on Canadian steel and aluminium, autos and lumber.

Doug Ford, the traditionally outspoken premier of Canada’s largest province Ontario, said “the prime minister has my full support for a strong response—tariff for tariff, dollar for dollar,” following Carney’s announcement.

Canada has been engaged in on-again, off-again trade negotiations with the US for over a year in pursuit of a deal that would see the US drop or reduce tariffs on these key sectors.

The US, meanwhile, has been asking for a number of concessions from Canada, including removing its remaining retaliatory tariffs on American autos and adjusting its dairy quotas to allow greater access for US cheese producers.

It has also asked for the ban on US alcohol sales, imposed last year by most Canadian provinces in retaliation to Trump’s tariffs, be removed.

Businesses and stakeholders on both sides of the border had pushed for a deal to be reached, arguing that the new US tariffs on Canada will be harmful to both countries.

The US Chamber of Commerce said earlier in the week in a statement that “higher tariffs would damage both economies, drive up costs for US families, further disrupt critical supply chains, and risk the 13 million American jobs that depend on trade under the US-Mexico-Canada Trade Agreement”.

A recent poll by Canadian firm Abacus Data suggested that around 36% of Canadian would support retaliating to US tariffs, while another 30% would want the Carney government to continue negotiating.

Retaliation risks upsetting the Trump administration, with trade representative Jamieson Greer saying the US is “not going to tolerate” counter-tariffs.

“We’ll take action,” he told reporters last week.

Aug. 21 (UPI) — Brazilian President Luiz Inácio Lula da Silva said he spoke by phone with President Donald Trump on Friday to push for resuming bilateral trade negotiations and discuss efforts to contain international conflicts.

According to Brazil’s presidential office, the 80-minute conversation resulted in an agreement for representatives of both governments to resume talks aimed at resolving the trade dispute, Agência Brasil reported.

During what the Brazilian government described as a “friendly and cordial” conversation, Lula rejected the U.S. justifications for imposing new tariffs, calling them “unfounded.”

The recent trade barriers imposed by the Office of the U.S. Trade Representative include an additional 25% tariff over alleged unfair practices and another 12.5% tariff linked to alleged shortcomings in efforts to combat forced labor.

The White House based the measures on a series of regulatory and political concerns involving issues including Brazil’s Pix instant payment system, anti-corruption efforts, the ethanol market and efforts to curb deforestation.

Lula argued that the trade restrictions lack a factual basis and cause direct economic harm to both countries.

The Brazilian president said diplomacy is the appropriate path forward and called for bilateral dialogue to remain open.

According to the statement, Trump was receptive to the need to preserve strategic trade ties and proposed that technical delegations from both governments resume meetings as soon as possible.

On security, Lula reiterated Brazil’s interest in cooperating with the United States in the fight against organized crime. He said criminal groups terrorize the country’s poorest communities on a daily basis but should not be confused with terrorist organizations.

Lula outlined progress in his government’s strategy to financially weaken criminal groups, citing seizures worth millions, and detailed the creation of maximum-security prisons.

Trump expressed willingness to deepen cooperation on border security and high-level intelligence sharing, according to the Brazilian government.

The two presidents concluded the call by discussing the need to pursue negotiated peace efforts to address the conflicts in Ukraine and the Middle East.

Aug. 21 (UPI) — President Donald Trump‘s threatened 50% tariffs on $20 billion worth of Canadian goods hung in the balance Friday as U.S. and Canadian negotiators met in Washington with a midnight deadline looming.

Canadian Minister for Internal Trade Dominic LeBlanc, his country’s lead negotiator, arrived at the offices of U.S. Trade Representative Jamieson Greer shortly after noon as the two sides met to strike a deal ahead of Trump’s 12:01 a.m. Saturday deadline, the CBC reported.

The U.S. president signed orders in July to impose 50% tariffs on Canadian goods, including cement, hockey sticks and many other items, representing about 2% of the entire trade between the United States and Canada.

The tariffs were to go into effect at 12:01 a.m. Wednesday, but were delayed through the end of Friday by an announcement on social media issued about 90 minutes before the deadline in which Trump said the two sides “have a DEAL!” with final implementation to come.

Canadian Prime Minister Mark Carney, however, was much more cautious, saying only that “substantial progress has been made, although there is important work still to be done.”

Details of the touted agreement have been scarce. However, Trump teased the possibility that it could reinstate work on the abandoned proposed Keystone XL oil pipeline from Alberta, which was dropped by then-President Joe Biden in 2021 over climate concerns.

The U.S. president also intimated that U.S. tariffs on Canadian autos could be part of the deal, which Greer suggested that the United States could adjust its current tariffs on Canadian steel and aluminum.

Canadian negotiators, meanwhile, want to ease the tariffs already imposed on Canadian industries, including duties of up to 50% on steel, aluminum and autos. Some tariffs also affect Canadian softwood lumber.

On Wednesday, after Trump extended the deadline, Carney urged a “Team Canada” approach during a virtual meeting with provincial and territorial premiers as some of them have toed a hard line in refusing to stock American alcohol products, which is seen as a main irritant to the Trump administration.

Manitoba Premier Wab Kinew on Thursday told reporters if a new deal allows a return of U.S. beer and spirits to Canadian shelves, local consumers should “leave it there.

“Don’t buy it. Let it sit on the shelf … and buy the Canadian stuff instead,” he said.

Carney on Wednesday emphasized “continued collaboration with provincial and territorial governments as the federal government works to finalize a deal with the United States,” according to an official readout of the meeting.

He reiterated the government’s goal is to “secure the best deal for Canadians — one that provides the greatest possible U.S. market access for Canadian businesses,” and emphasized “the importance of remaining focused on Canada’s central economic strategy: building our economic strength at home and diversifying our partners abroad.”

Aug. 18 (UPI) — President Donald Trump late Tuesday announced a three-day pause on imposing 50% tariffs on Canada less than two hours before they were to go into effect, saying a trade deal has been made.

The tariffs were to go into effect at 12:01 a.m. Wednesday, but were delayed by Trump’s announcement on social media issued about 90 minutes before the deadline.

No specifics on what the deal entailed were offered, though Trump said the controversial Keystone XL Pipeline project, revoked by former President Joe Biden over climate change concerns, “may be awoke from the grave!”

The deal remains to be finalized, he said.

While congratulating Trump, U.S. Trade Representative Jamieson Greer added that the deal includes “comprehensive access for all American goods,” economic security commitments, digital trade alignment and other provisions protecting the U.S. market.

Prime Minister Mark Carney of Canada has yet to comment.

Greer had been leading negotiations with Canadian representatives ahead of the deadline. He said last week that the negotiators were reviewing options and that he expects Canada to drop certain measures it had already taken in response to the U.S. tariffs, The New York Times reported.

“If a country retaliates against us, we’re obviously not going to tolerate that,” Greer told reporters Friday. “We’ll take action. My sense is the Canadians want to have a more conciliatory approach, but we’ll see.”

Trump signed orders in July to impose 50% tariffs on $20 billion worth of Canadian goods, including cement and hockey sticks, representing about 2% of the entire trade between the United States and Canada, starting Wednesday.

“President Trump is taking action to hold Canada accountable for its continued discrimination against and unreasonable and unequal treatment of U.S. commerce that has burdened and disadvantaged hard-working Americans,” the White House said in a statement at the time.

On Aug. 5, he called Canada “nasty” in a Las Vegas speech.

“Canada’s nasty. They are. They’re nasty,” Trump said. “I love the people, but they’re nasty. Nasty leadership.”

Canadian Prime Minister Mark Carney and Trump spoke on the phone Monday, a Carney spokeswoman said. She didn’t give any details.

Canadian negotiators also want to ease the tariffs already imposed on Ottawa industries. There are tariffs of up to 50% on steel, aluminum and autos. Some tariffs also affect Canadian softwood lumber.

Canadian lumber manufacturing CEO John Brink told CTV that tariffs have devastated the lumber industry. He said, “most of the lumber industry in Canada is paying up to 45.16% in tariffs and duties combined. So the effect has been devastating.”

Brink said about half of British Columbia’s lumber manufacturing capacity has shut down.

“There used to be 800 secondary manufacturers in British Columbia alone. We are now down to about 50. Not all due to tariffs and duties, but due to a combination of [factors],” Brink added.

“I think the big question for the United States is: Are they even interested in securing an agreement, a deal, some kind of operational détente, or is Trump’s real objective just to flex? Is it just to demonstrate he’s in control? In which case, we’re chasing a phantom deal,” CTV News political commentator Scott Reid said.

He added that the deadline will be “the most important, most significant and most treacherous of Mark Carney’s political career.”

Greer has said he expects Canada to make concessions if a deal goes through. But not everyone in the Great White North wants that.

“Canadians elected Mark Carney to both stand up to Trump while also trying to negotiate a deal, or negotiate down the tariffs, and I don’t think those are mutually exclusive, but it is a narrow path for sure,” said Brian Clow, a former senior official in Prime Minister Justin Trudeau‘s government, The Times reported.

If no deal is made, expect the trade war to escalate, Clow said.

“If the U.S. decides to proceed with imposing these new tariffs tomorrow, Canada, although this current government has eased back on retaliation, will have to respond in some way,” he said.

Former senior White House trade adviser Kelly Ann Shaw told CTV that negotiations look “promising” for Canada.

“I’ve been involved in a number of international trade negotiations and other negotiations throughout my career, and the hardest issues always get resolved at the very last moment,” Shaw told CTV Tuesday.

“So I don’t expect any sort of announcement until later today, possibly as late as midnight,” Shaw said. “But the fact the two parties are still at the table, I take as a good sign.”

Trump has long used tariffs as a mechanism for both punishment and negotiation, and during his second term, he attempted to impose sweeping tariffs, including against Canada, but they were thrown out by the U.S. Supreme Court in February.

The tariffs paused late Tuesday were to join the 10% import duty on many Canadian goods, as well as previously imposed tariffs ranging from 10% to 50% on products, such as steel, aluminum, copper, automobiles and softwood lumber.

Canada responded by imposing a temporary 25% tariff on certain wood cabinets and vanities, as well as a 25% tariff on U.S. vehicles, as well as selected steel and aluminum products, among others.

BREAKINGBREAKING,

Trump announces pause on 50 percent duty on Canadian exports shortly before midnight deadline.

The United States and Canada have reached a deal to avert steep tariffs on billions of dollars of Canadian goods, US President Donald Trump has announced.

Trump made the announcement shortly before the expiry of a midnight deadline for imposing a 50 percent duty on a wide range of Canadian exports, including electronics, industrial machinery, furniture, and dairy products.

“I have paused the 50% Tariffs against Canada, that were scheduled to kick in tomorrow morning for a three day period, based on the fact that Canada and the U.S.A., subject to the finalization of documents, have a DEAL!” Trump wrote in a post on Truth Social.

“The great Keystone XL Pipeline, long ago killed by Sleepy Joe Biden, may be awoken from the grave!”

More to follow…

Aug. 14 (UPI) — A federal trade court threw out a legal challenge to President Trump’s executive order scrapping the so-called “de minimis” exemption loophole under which goods worth less than $800 could enter the United States duty free.

Three judges sitting in the U.S. Court of International Trade ruled Thursday that Trump had the legal authority to invoke the International Emergency Economic Powers Act to eliminate de minimis, in contrast to his April 2025 “liberation day” global tariffs which it ruled were unlawful, a decision the Supreme Court subsequently upheld.

“In reaching this conclusion, we find that the President’s power to ‘nullify [or] void . . . exercising any . . . privilege’ does not run afoul of separation of powers principles,” they wrote in their judgment.

The judges found the removal of the exemption did not constitute “an exercise of the power of the purse” and “is not an exercise of the power to legislate.”

In the global tariffs case, the Supreme Court came to the opposite conclusion, ruling that Trump could not act without approval from Congress.

Trump hailed Thursday’s ruling as a “big win” for his resolve to get rid of what he said was a “ridiculous giveaway… one of the most DESPICABLE loopholes in American Trade Policy” that he said was costing the U.S. Treasury more than $10 billion in revenue from tariffs that it would otherwise receive.

“For years, Foreign Shippers could send packages worth up to $800 into our Country, DUTY FREE, NO TARIFF, far less scrutiny. It became a giant loophole for TARIFF Cheats — and a Pipeline exploited by Fentanyl Traffickers, Counterfeiters, and other Criminals shipping dangerous and illegal products into America. The numbers were staggering. In 2024 alone, de minimis cost America an estimated 10.8 BILLION DOLLARS in foregone TARIFF Revenue, and an astonishing share of narcotics and counterfeit seizures came through the de minimis channel,” said Trump.

Detroit Axle, a Michigan-based auto-parts distributor, brought the de minimis case last year on grounds Trump had overstepped his authority under IEEPA. The firm’s legal counsel did not immediately comment on the ruling.

U.S. Customs and Border Protection netted more than a billion dollars in 2025 from the ending of de minimis and the court ruling clears the way for it to continue until it is permanently eliminated when Trump’s One Big Beautiful tax cut and spending bill kicks in next July.

Brazil has not yet decided whether it will proceed with retaliatory measures, but has committed to defending its position.

Brazil has opened consultations into potential retaliatory measures against the United States following the imposition of 25 percent tariffs on a range of Brazilian exports.

The new US tariffs are “unjustified and arbitrary”, and Brazil will “continue to defend its position in all appropriate forums”, the Brazilian government said in a statement on Thursday.

The step is the beginning of the reciprocity process that could eventually see Brazil introduce retaliatory measures, including tariffs, on imports from the US.

This early stage involves further diplomatic consultations with US trade authorities.

In July, the US imposed a surcharge of 25 percent on some Brazilian imports, including sugar, clothing, paper and steel, alleging unfair trade practices. The US also hit Brazil – and a host of other countries – with an additional 12.5 percent tariff linked to allegations of lax enforcement of forced labour bans.

While no decision has yet been made, Brazil’s retaliatory options include imposing taxes or fees, eliminating exemptions or reducing import tariffs, or even restricting imports of American goods or services.

A source told the Reuters news agency that further measures could go beyond tariffs, for example by suspending pharmaceutical and agricultural patents.

The US runs a trade surplus with Brazil, meaning it sells the country goods and services worth more than it imports from it. In 2026 so far, the US has exported $26.5bn worth to Brazil and imported $17bn, according to the US Census Bureau.

Multiple rounds of tariffs

Under President Donald Trump, the US has repeatedly sought to impose sweeping tariffs on imports into the US, lamenting the US’s trade deficit with countries around the world.

In April 2025, the White House announced the introduction of a minimum 10 percent tariff on nearly every country, in what Trump and his team dubbed the “Liberation Day” tariffs.

Those were struck down by US courts this year, but the latest round of tariffs is widely seen as a replacement for the failed Liberation Day tariffs, designed to survive challenges in the US court system.

The White House said in a report on Thursday that more than 40 countries have helped China sidestep US tariffs by routing exports through nations that face lower American import duties.

The countries named include Canada, India, Mexico, Japan and South Korea, which the White House said had helped China evade tens of billions of dollars in tariffs.

White House trade adviser Peter Navarro said it had cost “American jobs and billions in revenue”.

A spokesperson for the Chinese embassy in Washington said in response to BBC queries that “trade wars have no winners” and that it opposes the US’ tariff measures and the use of state power to target China’s companies.

The spokesperson added that “any unilateral actions or agreements concerning transshipped goods must not target or harm the interests of third parties.”

The BBC has contacted the US embassies of Canada, India, Mexico, Japan, South Korea and other trading partners listed in the report for comment.

The report follows a wave of sanctions between the US and China and comes weeks before President Donald Trump will meet Chinese leader Xi Jinping in Washington.

According to government and private sector estimates quoted by the White House, between $30bn (£22.2bn) and roughly $300bn in goods have been moved from countries with higher tariff through those with lower rates.

The process is known as transshipping, which refers to the practice of transferring cargo through another country while en route to a final destination.

The US accused China of “taking advantage” of the practice by moving goods through nations that have lower duties.

China has used third countries as a stopover and has repackaged goods to hide their real origin to obtain lower tariffs, said the White House in its report, describing the process as “fraud cloaked in paperwork”.

“What has changed in today’s Great Transshipment Scam is not merely the speed and scale of this modern form of smuggling, but the breadth, depth, and sophistication of the global Shadow Transshipment Network through which China’s tariff evasion now moves,” the White House wrote.

The US has deployed artificial intelligence (AI) tools to catch transshipment efforts, it added.

The report is expected to add to key sticking points between the sides as Trump and Xi prepare to meet in the US in September.

Despite a pause in most tariffs following talks in May 2025, Washington and Beijing have continued to exchange sanctions, including restrictions on humanoid robots shipped to the US and tighter Chinese curbs on drone exports.

In April 2025, Trump unveiled sweeping levies on dozens of US trading partners based on a long-held belief that tariffs will help boost American jobs and the economy.

Those sanctions have since been struck down by the US Supreme Court, but Trump has repeatedly introduced new tariffs using alternative legal levers to continue his signature policy.

Aug. 13 (UPI) — The Trump administration on Thursday announced tariffs on imports of drones and related components, saying that the U.S. was ‘too reliant’ on drones produced overseas.

According to a White House fact sheet, a 100% tariff will be levied on “certain capabilities that are particularly sensitive for national security purposes, docking stations of these drones, and certain critical components of these drones.”

The category includes drones that have a top takeoff weight of more than 25 kilograms and those with thermal imaging features, the proclamations says.

The U.S. “is too reliant on foreign sources of [unmanned aircraft systems] and UAS components,” a proclamation signed by U.S. President Donald Trump says.

Meanwhile, smaller drones that do not have certain features that do not affect national security will face a 25% tariff. Drones and components produced in the European Union, Japan, Liechtenstein, South Korea, Switzerland and Taiwan will see a 15% levy. UK-produced drones will be assessed 10%.

The percentage of the tariffs will depend if “substantially all hardware, software, and technology originates from within these countries and the United States,” the fact sheet says.

The White House said the tariffs take effect in 21 days, but tariffs on drone components “that are not particularly sensitive,” will take effect in 180 days

For products and components that the Department of Defense has approved an exemption from the Federal Communications Commission’s Covered List within 20 days after being signed by Trump, the tariffs will take effect 180 days after signing.

The states claim the new levies are a pretext to re-impose tariffs that were ruled illegal by the US Supreme Court.

A group of 25 Democratic-led states has sued Donald Trump’s administration over its latest tariffs, claiming that the US president has exceeded his legal authority to implement the levies.

The lawsuit, filed in the US Court of International Trade on Monday, targets new double-digit tariffs imposed on 60 trading partners last month over allegations they were not doing enough to stop the importation of goods produced with forced labour.

These latest tariffs took effect just as the clock ran out on temporary tariffs that Trump had turned to after the Supreme Court struck down his flagship “liberation day” levies in a February ruling.

“After losing at the Supreme Court, the administration is once again trying to illegally raise taxes on families and businesses with a new round of tariffs,” said New York Attorney General Letitia James.

The states that sued over the new tariffs, including Oregon and New York, all have Democratic attorneys general or governors.

In response, White House spokesman Kush Desai said the levies were an appropriate and legal response to unfair trade practices in other nations.

“A foreign country’s failure to impose and effectively enforce a prohibition on the importation of goods produced with forced labor is unreasonable and burdens US commerce, including American workers, and must be addressed,” Desai said.

Revive US manufacturing

Trump, who argues that high tariffs will revive US manufacturing, last year overturned decades of Washington policy that favoured lower tariffs and ever-freer trade.

Invoking the 1977 International Emergency Economic Powers Act (IEEPA), he imposed double-digit tariffs on imports from almost every country, saying the US’s longstanding trade deficit amounted to a national emergency.

But the Supreme Court ruled that IEEPA did not authorise tariffs. The decision forced the administration to establish a refund process for importers who had paid the tariffs.

Eager to make up the lost revenue, Trump turned to temporary 10 percent worldwide tariffs, but they expired at midnight on July 24.

The latest round of global tariffs was imposed under Section 301 of the Trade Act of 1974, meant to combat unfair or discriminatory economic practices by other nations. The tariffs imposed in July affect more than 99 percent of US imports.

The states’ complaint, like two previous lawsuits filed by small businesses over the tariffs, argued that the new tariffs used “forced labor” as a pretext to re-impose the tariffs that had already been ruled illegal in court. They said that a sweeping tax on imports would do nothing to address the real problems of forced labour around the world.

California filed two lawsuits against the Trump administration Monday — one to block President Trump’s latest round of tariffs on international trading partners, the other to block his administration from sharing needy families’ personal data with immigration officials.

California Atty. Gen. Rob Bonta, whose office brought the lawsuits alongside other Democratically led states, said they were both intended to rein in a lawless president pushing policies that threaten American families already struggling to afford basic necessities.

Bonta said the new tariffs are part of a “failed and illegal economic policy” that has previously been blocked in court. He alleged that the proposed data sharing was part of a broader and illegal “mass surveillance effort” by the Trump administration to target its political opponents.

The White House did not immediately respond to requests for comment on the two lawsuits. But it has previously defended both tariffs and data-sharing policies as part of Trump’s “America first” agenda to improve the economic standing of American families.

Trump has defended his tariffs, and a previous set that was ruled illegal by the U.S. Supreme Court, as necessary to fix years of unfair trading practices in which international partners took advantage of the U.S. However, many economists have determined that the cost of the tariffs are being passed on to U.S. consumers and contributing to the persistent inflation causing economic pain nationwide.

Trump, the White House and top officials in his administration have also defended the sharing of personal data among U.S. agencies, and from individual states to the federal government, as a commonsense way to reduce waste and fraud and to identify and remove people who are in the country illegally and consuming benefits intended for American families.

The administration has previously sought the personal data of Medicaid recipients, SNAP food assistance recipients, immigrants who have filed taxes with the Internal Revenue Service and registered voters in states across the country. All of those demands have also been challenged in court, with varying degrees of success.

Bonta’s office has now filed 82 lawsuits against the current Trump administration.

Tariff lawsuit

Trump’s latest tariffs, levies of between 10% and 12.5%, took effect late last month and apply to more than 80 countries, including some of the closest U.S. allies and largest trading partners such as Canada, Mexico and the European Union. They followed a Trump administration announcement of new 50% tariffs on many Canadian products, set to go into effect this month.

“Tariffs are taxes, and the American people cannot and should not shoulder the extra costs that come from the president’s failed and illegal economic policy — no matter how much the president wants them to,” Bonta said in announcing the lawsuit in the U.S. Court of International Trade.

Two previous attempts by the Trump administration to unilaterally levy tariffs on trading partners were rejected by the courts in the face of similar legal challenges by California and other states. In February, the Supreme Court rejected a sweeping slate of tariffs Trump had imposed on an emergency basis. In May, the Court of International Trade turned back another set.

The Trump administration has said the president’s latest tariffs are authorized by a separate law not considered in the previous litigation — one related to combating forced labor in global trade.

The states’ lawsuit argued that the reliance on labor law was simply a “guise” used by Trump to impose new tariffs, and that “there is no rational fit between the purported problem of forced labor in international supply chains and the blanket global tariffs” imposed.

Bonta brought the case alongside the attorneys general or governors of 24 other states.

Data-sharing lawsuit

California joined a similar coalition of Democrat-led states to file a lawsuit challenging the sharing of needy families’ data, in federal court in Washington, D.C.

The lawsuit challenges a notice the Trump administration issued last month announcing the Administration of Children and Families would begin sharing the personal information of recipients in the federal Temporary Assistance for Needy Families program to outside agencies — including with the U.S. Department of Homeland Security, which houses Immigration and Customs Enforcement and other immigration enforcement units.

A spokesperson for the Administration for Children and Families said it does not comment on ongoing litigation.

The program provides $16 billion in grants annually to the states, which use it to provide cash assistance to low-income families. Some 350,000 families in California receive support through the program each month, Bonta’s office said.

Bonta said the sharing of program data with Homeland Security would be a clear violation of the law establishing the fund.

“The Trump Administration is exploiting a program designed to ensure children do not go hungry and to help needy families get back on their feet in order to fuel its mass surveillance effort. It’s cruel, unnecessary, and illegal,” Bonta said in a statement.

During a morning news conference, Bonta said one of his concerns is that immigration officials will use data to target the undocumented parents of U.S. citizen children who are legitimately receiving assistance through the program.

“They’re seeking Social Security information, marital status, income information,” he said. “We think that they might be interested in that information to potentially target parents.”

He said he also believes the data sharing is part of a much broader effort by the Trump administration to gather up as much data as possible in order to target individuals who do not conform with the administration’s political agenda, including on immigration policy and on issues such as abortion and gender-affirming care.

“While the Trump Administration continues to break the law in order to amass an ever-greater trove of people’s personal information, we’ll continue stepping in to protect the privacy of our people,” Bonta said.

The lawsuit is just the latest in a much broader legal war over the Trump administration’s drive to force all kinds of federal and state social services and financial programs to share the personal data of benefit recipients and other program users.

California is fighting alongside other states in court to block the U.S. Department of Health and Human Services from sharing personal data of Medicaid recipients with Homeland Security, though some of that data have already been shared.

California is also fighting alongside other states in court to block the U.S. Department of Agriculture’s demand that states turn over the personal data of millions of Supplemental Nutrition Assistance Program, or SNAP, recipients. The demand came with a threat from USDA that it would cut off funding to states that don’t comply. Courts have blocked the suspension of funds, but some data have been shared.

Immigrant rights groups, including Los Angeles-based Inclusive Action for the City, are also suing to block a Trump administration plan to share IRS taxpayer data with Homeland Security. The Trump administration has said the data sharing would be used to target only criminals, but immigrant rights advocates have denounced it as an attempt to do just the opposite — to target immigrants who have been in the country and paid taxes for years.

A sweeping package of new Russian sanctions has cleared its first hurdle in the United States Congress, and, if passed, could trigger huge tariffs for countries such as India and China which continue to buy oil from Moscow.

The bill, which was advanced in the US Senate this week, has been named for the late Lindsey Graham, whose funeral was attended by world leaders including Israeli Prime Minister Benjamin Netanyahu earlier in the week.

Here’s what we know:

What happened in the Senate?

The “Lindsey O Graham Sanctioning Russia Act of 2026” was advanced overwhelmingly by the Senate this week in a vote of 86 to 12, meaning it can now proceed to the House of Representatives for further deliberation.

Named for the late Senator Graham, a staunch Ukraine supporter who died unexpectedly this month, the bill moved forward with the support of Ukrainian President Volodymyr Zelenskyy, who was in Washington to attend Graham’s funeral and watched the proceedings from the gallery.

“It was an honour to be present as the votes were counted – 86 senators supported the bill,” he wrote on X afterwards. “This is the first step towards implementing Lindsey [Graham]’s plans, and certainly a step towards peace. It is important that this tool works.”

After clearing the Senate, there will be a delay before the bill can move forward to the House, which is now in summer recess.

On Wednesday this week, US President Donald Trump ordered lawmakers to amend the bill to include tariffs covering Iran as well. This will likely delay the bill further if it deters Democrats from supporting it, analysts said.

David Smith, an associate professor at the University of Sydney’s US Studies Centre, told Al Jazeera: “One of the things they’re worried about is how the tariff power in relation to Iran is going to be expanded. They’re going to be ok with tariff powers on Russia but they’re worried about tariff power on countries buying Iranian oil, which means China. I think there are going to be a lot of Democrats that are going to say these powers should be limited to sanctions and not tariffs.”

Without the Iran addition, he said he would have expected the bill to pass once the House resumes given strong Democratic support for Ukraine.

“Democrats have been genuinely worried about the Trump administration abandoning Ukraine. Something like this, which is ramping the pressure up on Russia so much, I just think there will be a large critical mass of Democrats who will vote for this,” he said.

What’s in the bill?

The bill makes use of sanctions and tariffs to target Russia and cut off the economic pipeline that has kept the Ukraine war going.

Major provisions include new sanctions on Russian President Vladimir Putin as well as on more than 20 top officials and companies which work with the Russian defence industry. It also targets Russia’s “shadow fleet” of oil tankers and the network it uses to evade international sanctions on its energy exports.

The bill gives the president authority to impose sanctions by invoking the International Emergency Economic Powers Act (IEEPA). Under it, he would be able to apply tariffs of up to 100 percent on exports to the US from the top five purchasers of Russian energy, military equipment or countries facilitating Russian sanctions evasion.

Tariffs of up to 500 percent can also be applied to Russian imports directly into the US. The US imported $3.8bn in goods from Russia in 2025.

Which countries are likely to be targeted?

China, India and Türkiye are potential targets of the bill, as they are among the largest buyers of Russian energy, according to data compiled by the Centre for Research on Energy and Clean Air (CREA).

China has historically responded to Trump’s tariffs with tariffs of its own on US exports. Even Pay, a director at the Beijing-based consultancy Trivium China, told Al Jazeera that the US may wait to impose tariffs as Trump is due to meet Chinese President Xi Jinping later this year.

Trump would still welcome the option, she said, after the Supreme Court struck down many of his tariffs in February.

“If passed and signed into law [which is still a big if at this point], the legislation would give Trump something he’s wanted for a while, namely, the legislature’s permission to impose high tariffs on China, alongside the small handful of other countries that import Russian oil,” Pay told Al Jazeera.

India is in a tricky position as its attempts to diversify away from Russian energy were disrupted by the shutdown of the Strait of Hormuz, according to Maia Nikoladze, a deputy director of the Economic Statecraft Initiative at the Atlantic Council.

Due to the disruptions, it has also applied for and received US sanction waivers to continue buying Russian oil in the interim, Nikoladze wrote in a report this week, and it is expected to do the same in the future.

“India will face a trade-off between maintaining energy security and managing the risk of US tariffs, potentially prompting it to again seek waivers and exemptions,” Nikoladze said.

What do critics say about the bill?

Critics like Senator Maggie Hassan say the bill gives Trump too much power to impose tariffs while also potentially harming both the US taxpayer and allied countries.

Turkiye, for example, buys Russian energy but it is also a US ally and NATO member, while “major non-NATO ally” Brazil and “major security cooperation partner” Singapore both buy Russian oil products, according to CREA.

In a post on X, Hassan wrote that while she supports sanctioning Russia, she does “not think tariffs, which are paid for by American businesses and consumers, will help Ukraine win”.

The bill is also opposed by lobby groups such as the US Chamber of Commerce, which also says the true cost will be passed on to US businesses and consumers, as with past tariffs.

While many of Trump’s tariffs have already been struck down by the Supreme Court, the Russia tariffs could have more staying power because they would be imposed on a stronger legal basis, according to Smith.

That’s because it is new legislation which has been crafted using the powers of the IEEPA.

“Previously what Trump has done is to go back to old pieces of legislation and invoke from those his power to use tariffs in ways they haven’t been used before and in ways courts have subsequently found less lawful, whereas this looks like new legislation that is going to lawfully expand his tariff authority,” he told Al Jazeera.

July 27 (Asia Today) — Growing artificial intelligence demand and stronger trade barriers are rapidly reshaping the production and supply chains of South Korea’s major manufacturing industries, the Bank of Korea said Monday.

The central bank said Taiwan has become South Korea’s second-largest semiconductor export destination as the AI supply chain draws Korean memory-chip producers closer to Taiwanese manufacturers.

Meanwhile, South Korean automakers are increasing production in the United States and expanding hybrid vehicle exports as tariffs and U.S. industrial policies make direct exports less competitive.

The findings were included in the Bank of Korea’s Map of Production and Supply Chains for South Korea’s Major Manufacturing Industries. The report used data from 2024 and 2025 to examine 11 industries, including semiconductors, automobiles, steel, shipbuilding and petrochemicals.

South Korean semiconductor exports to Taiwan nearly tripled from $12.78 billion in 2022 to $36.77 billion in 2025.

Taiwan’s share of South Korea’s semiconductor exports increased from 9% to 19.9%, moving it from the fourth-largest export destination to the second largest.

China remained the largest destination, but its share fell from 53.1% in 2022 to 40.3% in 2025.

The central bank attributed the change to a shift in demand from conventional dynamic random-access memory chips to graphics processing units and high-bandwidth memory used in AI systems.

The AI semiconductor supply chain generally involves U.S.-based Nvidia designing graphics processors, Taiwan Semiconductor Manufacturing Co. producing and packaging the chips and Samsung Electronics and SK hynix supplying high-bandwidth memory.

That structure has increased the volume of South Korean semiconductor products shipped to Taiwan.

Semiconductors have also become more important to South Korea’s overall manufacturing sector.

Domestic semiconductor production rose from 74 trillion won in 2014 to 210.8 trillion won in 2024 ($50.4 billion to $143.6 billion). Its share of total manufacturing production doubled from 5% to 10.1% during the same period.

Production remains heavily concentrated in the greater Seoul area, which accounted for 82.3% of the national total. The Chungcheong region accounted for another 14.7%.

Major facilities in the Seoul metropolitan region include Samsung Electronics plants in Hwaseong, Pyeongtaek and Giheung and SK hynix’s plant in Icheon.

China’s growing influence was most apparent in South Korea’s automobile import market.

The share of vehicle imports from China increased from 3.5% in 2022 to 37.2% in 2025. Chinese-made vehicles accounted for about 70% of South Korea’s electric vehicle imports by value in 2025.

The report attributed the increase to China’s price competitiveness and its extensive supply chain covering vehicles, batteries and components.

The United States remained South Korea’s largest automobile export market in 2025. Shipments were valued at $30.15 billion and accounted for 41.9% of total finished-vehicle exports.

However, the United States’ share of South Korea’s electric vehicle exports fell from 33.6% in 2022 to 5.2% in 2025.

The central bank said U.S. subsidies, local production requirements and tariff barriers had weakened the competitiveness of electric vehicles manufactured in South Korea and shipped directly to the United States.

South Korean automakers have responded by expanding U.S. factory operations while increasing exports of hybrid vehicles.

Hybrids’ share of South Korea’s finished-vehicle exports rose from 11.6% in 2022 to 20.4% in 2025.

The shift reflects automakers’ efforts to respond to slowing electric vehicle demand and insufficient charging infrastructure by offering vehicles that combine electric motors with internal combustion engines.

— Reported by Asia Today; translated by UPI

© Asia Today. Unauthorized reproduction or redistribution prohibited.

Original Korean report: https://www.asiatoday.co.kr/kn/view.php?key=20260727010009651

July 27 (UPI) — Brazil and China agreed Monday to speed up negotiations on a trade agreement between Mercosur and China as both countries seek to strengthen economic ties after new U.S. tariffs hit Brazilian exports.

Brazilian President Luiz Inácio Lula da Silva and Chinese President Xi Jinping spoke by telephone for more than an hour just days after the United States confirmed a 25% tariff on Brazilian exports.

Lula said on X that the two leaders reaffirmed their commitment to expanding cooperation in strategic and high-technology sectors, including artificial intelligence, satellites, critical minerals processing and fertilizer trade.

In the post, Lula highlighted the “positive results” of bilateral trade and the recent short-term visa waiver, saying the measures “will increase tourist flows and business opportunities.”

He also emphasized the need to expand cooperation in other sectors and advance negotiations on a trade agreement between Mercosur, the South American trade bloc, and China.

“I stressed that our government remains committed to diversifying markets,” Lula wrote.

The two leaders also discussed global conflicts and their impact on people’s lives, as well as global food and energy security, identifying them as key international challenges.

“While discussing the crisis in the Middle East, we agreed that restrictions on freedom of navigation through the Strait of Hormuz and the Bab el-Mandeb Strait have harmful effects on the global economy,” Lula said.

According to China’s state-run Xinhua News Agency, Xi rejected what he described as external interference in Brazil’s electoral process and expressed China’s willingness to support Lula’s government.

Xi said that under new global circumstances and challenges, China and Brazil, as leading members of the Global South, should uphold historical justice and the progress of civilization while playing a greater role in reforming and improving the global governance system and defending international fairness and justice.

According to Xi, China “highly values Brazil’s international standing and significant influence, supports the country in safeguarding its sovereignty and independence, opposes foreign interference and will contribute to maintaining regional and global peace and stability.”

Lula also said both leaders criticized the inability of the United Nations Security Council to respond effectively to current international crises and reaffirmed Brazil’s and China’s commitment to multilateralism. They agreed to maintain close coordination on international issues through forums, including the United Nations and the BRICS group.

The conversation comes as Lula has intensified his efforts to diversify Brazil’s trade relationships. In an article published Sunday in The Washington Post, he described the new U.S. tariffs on Brazilian goods as a “strategic mistake” and said Brazil would pursue alternative markets to expand investment and economic partnerships.