Trade War

Abbotsford, British Columbia – Every second day, 28,000 litres of raw milk leave Casey Pruim’s farm in Abbotsford in western Canada, entering a distribution system built on the assumption that the milk and the products made from it will have somewhere to go.

While most is consumed in Canada, some had been sold across the border to the United States.

Those sales have largely come to a standstill since US President Donald Trump’s 50 percent tariff on $20bn in Canadian goods, including dairy products, came into effect on August 22.

Pruim, who is also chair of the British Columbia Dairy Association representing about 400 dairy farmers across the province, told Al Jazeera that Canadian farmers do not individually decide which products are exported.

Instead, producers such as Pruim –  whose farm has 330 cows milked three times a day  –  sell into the provincial milk-marketing system, which distributes milk to processors according to demand, including for products exported to the US.

If a processor loses US demand, it may require less milk, with the impact then spread across the provincial pool.

Dylan Kruger, director of public affairs at BC Dairy, told Al Jazeera “there is still considerable uncertainty around the impact of the US tariffs”.

He said it was too early to know how the industry would be impacted or whether milk no longer sold to the US could be sold elsewhere, mitigating financial losses.

But the tariffs and wider trade tensions have already introduced uncertainty and instability for businesses.

“If the processor who’s exporting some of his product to the United States can no longer sell into that market because he’s now priced out of the market with a 50 percent tariff, that’s how it would impact the dairy farm,” Pruim said.

Pruim said if processor demand is squeezed, farmers would be forced to dump the milk. In the worst-case scenario, the herd has to be cut.

“Cows aren’t like a tap; you can’t just turn them on or off,” he said.

His warning captures dairy’s particular vulnerability in a tariff war: Milk is highly perishable, collected on a tight schedule and dependent on processors whose demand can change much faster than farmers can adjust production.

“These tariffs are completely unwarranted,” David Wiens, president of the Dairy Farmers of Canada, told Canada’s CBC News, adding that they would affect “the supply chain, not only in Canada but in the US as well”.

Supply-management system

Dairy trade between Canada and the US has largely operated under a free trade agreement between the US, Mexico and Canada, known as CUSMA in Canada.

Canada manages the supply of dairy, poultry and eggs through a national agricultural policy known as supply management. The system uses production quotas and import controls, including tariffs, to provide farmers with more stable and predictable prices while maintaining domestic supply.

Critics describe the system as protectionist and as a government-backed cartel.

Washington argues that Canada’s supply-management system restricts US dairy exports. Trump posted on Truth Social that “Canada had been ripping off the United States of America for years” and accused it of imposing “ridiculously high tariffs” that made life impossible for US farmers.

Canadian producers reject that argument, saying the existing trade agreement already gives US imports substantial tariff-free access that is not fully utilised.

Canada’s dairy trade deficit with the US has grown significantly since CUSMA came into force on July 1, 2020, according to the Dairy Processors Association of Canada.

In 2020, Canada exported 241.3 million Canadian dollars ($173m) in dairy products to the US and imported 647.4 million Canadian dollars ($462.7m) worth of dairy and dairy products. In 2025, Canadian dairy exports had risen to 308.7 million Canadian dollars ($220.7m) while dairy imports from the US had more than doubled to 1.355 billion Canadian dollars ($968.5m), accounting for 13.8 percent of total value of US dairy exports, according to the association.

Bryan Yu, chief economist at Central 1 credit union, said the immediate shock of losing a major market could be difficult for Canadian producers to absorb because replacement buyers cannot be found quickly.

“There is going to be pain in the near term for a lot of our producers,” Yu told Al Jazeera.

“You really can’t quickly adjust to a 50 percent tariff, because it’s uncharted waters for a lot of industries … and ultimately it shuts [Canadian producers] out, because a lot of them don’t have the margins that they can play with,” he said.

Yu said Canadian consumers might absorb some of the additional supply while exporters search for new markets and higher-value products, but neither adjustment is instantaneous.

“There are global markets as well, especially when you talk about chilled, chilled beef, chilled products and really it’s a question of whether … other types of markets that could be available.”

Canada has also imposed retaliatory tariffs, which came into effect on September 8 and cover $20bn worth of US products.

Dairy products are among the targeted goods. The list includes a 50 percent tariff on milk, cream and whey products and a 25 percent tariff on many cheeses imported from the US.

Canadian Prime Minister Mark Carney has framed Ottawa’s response as both retaliation and an attempt to build greater economic resilience.

Announcing the collapse of the latest negotiations, he said Canada would match Washington’s new tariffs “dollar for dollar” to protect workers, farmers, families and businesses.

But retaliatory measures carry risks of their own.

“Canada’s new retaliatory tariffs will help some industries but hurt most and weaken economic growth across the country by raising costs for producers and consumers,” Oxford Economics said in a report.

For now, geography remains important for perishable goods like dairy products that once moved quickly across the US border and cannot be redirected overnight to a distant market without new buyers, logistics and regulatory approvals.

Ottawa’s Trade Commissioner Service is advising affected companies to check their CUSMA compliance, explore available relief and contact trade commissioners about potential new markets.

Yu predicted that the US and Canada could reach a tariff deal in the following months but said the interim period could bring “higher prices, weaker economic activity and deeper mistrust”.

For Pruim, the uncertainty is as destabilising as the tariff threat itself.

“I think, like [for] any Canadian, it’s disappointing to have these trade talks collapse again and just the uncertainty around it.”

Published on
17/09/2026 – 17:24 GMT+2

The European Commission stepped up pressure on China on Thursday, calling for tangible results with Beijing following a one-hour video call between Trade Commissioner Maroš Šefčovič and his Chinese counterpart, Wang Wentao.

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The EU executive hopes to secure commitments from Beijing to rebalance the trade relationship, as the bloc’s trade deficit with China has been widening by €1 billion a day.

However, Beijing wants to secure access to the EU’s market of 450 million consumers, resisting calls from the Europeans to reduce its exports.

“While genuine engagement remains a priority, it is equally important that first concrete outcomes are delivered at the second session of the Trade and Investment Council in Beijing in October, which the Commissioner will co-chair – a signal that we are moving from rhetoric to results,” the Commission said in a statement after the call.

“That outcome needs to be credible,” the statement added.

The EU-China Trade and Investment Council was launched in June as a dialogue between the two sides, with the Commission setting October as a deadline to reach tangible results.

During the call on Thursday, Šefčovič and Wentao discussed market access on both sides and Chinese export controls on rare earths.

China has a near-monopoly over the production and processing of these strategic materials, which are essential to the EU’s green technology, defence and automotive industries, giving Beijing significant leverage in the negotiations.

The EU is seeking assurances that China will not halt its exports of rare earths again, a year after blocking them amid a trade war with the US. Securing the necessary export licences is essential for EU businesses.

EU leaders expect results

The coming weeks will be crucial for the negotiations, with EU officials expected to make another trip to China for technical discussions before Šefčovič himself travels to Beijing on 8–9 October.

In her State of the Union address to MEPs on Wednesday, European Commission President Ursula von der Leyen also pushed for concrete results in the EU-China talks.

“Words are good. But deeds are better,” she said, making clear that the EU was ready to use all its trade defence instruments to rebalance the trade relationship.

China is also expected to feature prominently on the agenda when EU leaders meet in October. They have tasked the Commission with securing tangible results from its dialogue with Beijing.

In an interview with Euronews, Šefčovič also made clear that, without a “deliverable” to present to EU leaders,“the political interest would be to look for the solution through other instruments.”

The EU has several trade defence instruments such as anti-dumping duties or tariffs against unfair subsidies.

A diversification tool is also in the pipeline, aimed at reducing EU firms’ reliance on Chinese critical minerals for strategic technologies by helping them diversify their sources of supply.

Such a move would come as relations between Beijing and Brussels remain strained, following the Commission’s introduction of several legislative proposals aimed at protecting the EU market. One of them would introduce a European preference for products made in Europe, prompting China to threaten retaliatory measures.

Last summer, China also urged its companies to stop cooperating with the Commission in antitrust investigations, after the EU executive opened a probe in May into e-commerce giant JD.com over concerns about subsidies.

In address to European parliament, Canadian Prime Minister Mark Carney listed areas where he wants to boost cooperation.

Canadian Prime Minister Mark Carney has welcomed the prospect of his country becoming the European Union’s first associate member, saying such an alliance is aimed to be a “beacon for democracies” and not to “dominate others”.

Speaking in the European Parliament in Strasbourg, Carney said Canada “welcomes” von der Leyen’s ambition to make the country an associate member.

“We are not fair-weather allies. We do not pursue zero-sum deals. We hold common values for which we have always fought, and in whose defence we must always remain vigilant,” Carney said to applause from European lawmakers.

“Canada and Europe are each strong. Europe and Canada are stronger together.”

“I am not proposing a third bloc in order to become a great-power rival – only with better manners,” he continued. “We do not seek power to dominate others. On the contrary, we are pursuing resilience so that no one can control our open markets, impair our sovereignty, threaten our territorial integrity, or undermine our freedoms, our democracies, our rule of law.”

Carney listed a slew of areas where he wanted to ramp up cooperation.

“Canada and Europe should secure our strategic autonomy through deep cooperation in the full range of strategic capabilities, including critical minerals, defence industrial capacity, AI and compute, energy security, space and payments.”

He also said the EU and Canada should move towards “seamless digital trade” and allow young people from both sides to work and study on either side of the Atlantic.

The EU and Canada have been facing stiff rivalry and pressure from Trump’s administration on trade, among other matters, and from an increasingly assertive China.

Trump threatened late on Wednesday to take action against the EU if it moves forward with von der Leyen’s proposal of associate membership for Canada.

“If they do that, if I think it’s at all a hostile act, I will put very serious tariffs or stop trading with Europe on many things,” Trump told reporters, calling the proposal “laughable”.

“If it’s a good intention, that’s fine. If it’s a bad intention, we’ll put very heavy tariffs on Europe,” he added.

The European Commission (EC) said von der Leyen’s proposal – which is yet to be fleshed out and will need to be approved by EU member states to go forward – was not a hostile act.

“As our President (von der Leyen) made clear yesterday, the proposed strengthening of our partnership with Canada is not against anyone else, but for our common strength,” said Olof Gill, an EC spokesperson.

TORONTO — Ontario Premier Doug Ford said Thursday he hopes President Trump’s Republicans lose both the House and Senate in the midterm elections, saying voters should punish Trump politically for his escalating trade war with Canada.

“Hopefully he’s going to lose the Senate. He’s going to lose Congress. I hope so, and hold him accountable,” Ford said. “But we’ll see how that goes. We aren’t going to interfere in the U.S. election.”

Ford has emerged as one of Trump’s most outspoken Canadian critics, accusing him of trying to strip industry out of Ontario and move it south of the border as the two trade personal insults and threats.

Ford’s comments came two days after Washington escalated the dispute by banning some Canadian dairy products and motorcycles and most alcoholic beverages after Canadian retaliatory tariffs took effect on about $20 billion in U.S. goods. Trump also moved to shut Canadian products out of large, long-term U.S. government contracts.

“He’s not reliable at all,” Ford said. “He could make a deal today and then change his mind. And we’ve seen that over and over again.”

Still, Ford said he believes Trump wants an agreement before the midterms and that Canada should return to negotiations as soon as possible.

“I truly believe President Trump wants a deal before the midterms,” Ford said. “I could be wrong, but I think it’s best that we sit down and get a deal.”

Last year, Trump abruptly ended trade talks with Canada after Ford’s Ontario government aired an anti-tariff television ad in the United States using former President Ronald Reagan’s criticism of tariffs.

The feud repeatedly has turned personal. In an interview with the Associated Press last month, Ford mocked Trump for keeping a portrait of Reagan near his desk while pursuing tariffs the former president had criticized, saying Reagan would be “throwing up on him from the picture if he knew what was going on.”

Trump described him as “the less charismatic, intelligent, and overall unimpressive brother of the late, great, Rob Ford.”

Trump also signed an executive order directing the U.S. government to refer to Lake Ontario as “Lake America,” a name Canada does not recognize.

Ford said Thursday that Trump unintentionally strengthened Canada by forcing it to reduce its dependence on the United States.

“The only two good things Donald Trump has ever done for Canada,” Ford said, were that “he woke us up” and “he united the country like I’ve never seen before.”

Gillies writes for the Associated Press.

WASHINGTON — A trade war between the United States and Canada entered a new phase Tuesday as Ottawa’s retaliatory tariffs on American goods took effect, escalating a dispute that has steadily strained relations between the allies.

Canada’s tariffs, which came into force just after midnight, cover roughly $20 billion in U.S. goods and impose duties of as much as 50% on products, from steel and aluminum to farm equipment, clothing and electronics. The list also reaches into the everyday commerce that binds the two economies, including cheese, seafood and cosmetics.

It was the latest sign that relations between the two neighbors have reached their lowest point in decades, after Trump dismissed Canada as the 51st American state, moved to rename Lake Ontario and mocked its armed forces.

Ottawa’s latest measures are a response to tariffs imposed by President Trump last month on Canadian exports. The two governments had appeared close to a trade deal just a month ago. But talks broke down in dramatic fashion, leaving both sides aggrieved and accusing the other of negotiating in bad faith.

In a post Tuesday, Trump said Canada “has been ripping us off for years” and threatened to respond by removing access for Canadian businesses to key American markets.

“What many do not realize is that the Canadian Government, including Canadian Provinces, have banned American Small Businesses and Companies from selling into their Government Procurement Markets,” Trump wrote. “This is the case even though Canada gets broad access into the massive American Government Procurement Market, including those of our States.

“That is not reciprocity, it is a Canadian Trade Scam. From now on, NO RECIPROCITY — NO ACCESS!” he continued. “I am hereby directing the [General Services Administration], working with the [U.S. Trade Representative], to take all necessary steps to REMOVE Canadian-origin products from GSA’s Multiple Award Schedules unless Canada restores full and fair reciprocity for American Farmers and Companies.”

Canada’s prime minister, Mark Carney, has characterized the confrontation as more than a dispute over tariffs, arguing that demands by a bullying Trump administration threaten Canada’s economic independence.

In a video released Tuesday, Carney argued that in the past, the United States has tried to use tariffs to “break us,” only to have Canada’s economy grow stronger and more diversified. He urged Canadians to buy Canadian and break economic dependency from the United States.

“This won’t be easy, and I won’t pretend otherwise,” Carney said. “But Canadians have faced difficult stretches before, and what has carried us through has never ever been any one measure. It’s always been Canadians looking out for each other.”

Trump, meanwhile, has pressed Canada to make concessions on trade and has warned of further tariffs, including potentially higher duties on Canadian automobiles. He also threatened to ban the sale of aircraft from Canada’s Bombardier unless its products are manufactured in the United States.

“If they want our Market, they must build here, and stop treating America like a ‘piggybank,’” Trump wrote on Truth Social on Monday. “BUY AMERICAN. FLY ON AMERICAN AIRLINERS. ENJOY AMERICAN LIQUOR AND BEVERAGES. SAIL ON LAKE AMERICA. AMERICA FIRST!”

Earlier Monday, Trump posted an image showing Mexico, Canada, Central America, Greenland and Caribbean nations with the colors of the American flag. He also posted a caricature of him and Carney playing hockey in which Trump tells him: “Get up, Governor.”

Both sides stand to lose in a trade war poised to hurt businesses large and small across the world’s longest international border.

A prolonged economic conflict poses long-term risks for Canada, which faces price hikes and investment losses from the United States, by far its largest trading partner.

But Americans may also confront higher costs at a time when inflation is already a stubborn problem for the Trump administration. And the trade war may be felt most in northern border states set to hold midterm elections that could swing control of the U.S. Senate, becoming yet another political challenge for embattled Republican lawmakers.

In Maine, Republican Sen. Susan Collins, who is seeking reelection, has called Trump’s tariffs “a mistake.” In Michigan, Democratic Senate nominee Abdul El-Sayed released a video Tuesday highlighting everyday goods that have risen more than 30% over the last year, including Tide Pods, toilet paper and Tim Hortons coffee, as the trade conflict and war in Iran drive up costs.

American alcohol has also been the target of boycotts imposed by several Canadian provinces since March 2025 in response to earlier tariffs on Canadian goods by Trump.

The boycotts since then have erased roughly $360 million in revenue for the U.S. wine industry, according to a Wine Institute report, which represents California wineries. Canada makes up more than 35% of the export market for U.S. wine, more than the EU, U.K. and China markets combined.

For some California winemakers, the impact was even greater. One Sonoma winery referenced in the report said Canada made up about 85% of its international sales. Multiple wineries have had to lay off employees because of hits to their business.

“It’s had a tremendous negative impact,” said Julie Berge, vice president of communications at the Wine Institute.

Wine is not the only California business that has taken a hit — tourism has also seen a sharp decline in arrivals from Canada. In 2025, visitors from the country dropped by 20%.

Canada also targeted the agriculture, electronics and transportation equipment industries with its tariffs announced Tuesday, all of which have a presence in California.

Soon after the World Cup brought positive international attention and tourists to the United States, Trump escalated trade tensions with Canada.

“You went from this really high, exciting moment for the U.S. in terms of international attention, to the next week, it’s negative again,” Deborah Friedland, a hospitality consultant at financial services firm Eisner Advisory Group, told the Associated Press. “It’s one step forward and two steps back.”

Times staff writers Wilner and Ceballos reported from Washington and Duneja from Los Angeles.

Trade tensions soar as Canada matches US tariffs ‘dollar-for-dollar’, impacting 700 products and multiple industries.

Canada’s retaliatory tariffs on imports from the United States have taken effect, escalating the trade dispute between the two countries.

Tariffs ranging from 15 percent to 50 percent will apply to nearly $20bn worth of US imports from 12:01am ET (04:01 GMT) on Tuesday, matching US-imposed levies on Canadian goods including machinery, textiles and consumer products.

The new retaliatory tariffs apply to products including steel, household appliances, agricultural equipment and dairy.

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

US President Donald Trump announced 50 percent tariffs against Canada in July, citing “discriminatory treatment” of US products. The announcement prompted the countries to enter trade talks in August, but a final deal failed to materialise before a deadline imposed by Trump.

“Canada wants the benefits of being a State, without being one!!!” Trump posted on Truth Social in response to Canada’s announcement in August.

The Canadian government said in a statement that the counter-tariffs will impact more than 700 products, adding that it would launch a $5.42bn support package for affected small and medium-sized businesses and workers.

On the eve of Ottawa imposing its tariffs, Trump threatened to block Canada-based aircraft manufacturer Bombardier from selling its planes in the US unless it began manufacturing them in the country.

The dispute has also extended beyond tariffs, with Trump signing an order last month renaming Lake Ontario “Lake America” for US federal use.

The retaliatory tariffs could place a financial burden on US automakers as Canada is the largest buyer of US-manufactured cars.

Americans could soon see increased prices on 550 consumer goods from Canada. According to a report from the Kiel Institute for the World Economy, US importers and consumers absorb 96 percent of the tariff burden.

The United States economy has added 162,000 jobs in August, with large gains in local government education and food services.

The unemployment rate remained unchanged, according to the monthly jobs report released by the US Department of Labor’s Bureau of Labor Statistics (BLS) on Friday.

The data was well above analysts’ expectations. Economists polled by Reuters had forecast 56,000 gains, the Wall Street Journal forecast 53,000, and Bloomberg had forecast 55,000, following a loss of 23,000 in July.

Local government education, or public schools, accounted for nearly 42,000 of the jobs added as the 2026–27 school year begins across much of the US. Teachers typically fall off payrolls during the summer months when school is not in session.

Food service jobs also saw large increases, with the sector adding 59,000 jobs for the month of August compared with the month prior.

There were also gains in construction, which added 22,000 jobs, and healthcare, which added 12,000.

The information sector, which accounts for industries like data processing, web hosting, publishing, broadcasting and telecommunications, fell by 23,000, with notable layoffs at companies including Scripps TV and Zillow, which fall under the umbrella of these industries.

The financial activities sector, which accounts for industries like insurance, commercial banking and real estate, dropped by 12,000.

Mixed data

The data comes in sharp contrast to the ADP national employment report, which tracks private payrolls and found 38,000 jobs added across the US economy.

Meanwhile, the Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) report released on Tuesday revealed job openings were slightly changed, with 7.3 million in July, up from 7.2 million the previous month, while total separations fell to 5.1 million in July from 5.3 million in June.

The move in job gains comes ahead of the US Federal Reserve’s policy meeting later this month, where the central bank will vote on interest rates. Amid the job gains, CME Group’s FedWatch, which tracks the likelihood of monetary policy decisions, had a 60 percent chance of a 25 basis point rate increase to 3.75–4.00 percent, up from 49 percent on Thursday.

US President Donald Trump was quick to comment on the jobs report and push for rate cuts.

“Lower the interest rates because the U.S.A. is a much stronger credit than it was a short time ago!” he said in a post on his social media platform Truth Social.

He also ramped up threats to cut off trade with nations that the US has a deficit with if the central bank does not cut rates.

Despite a strong jobs report, US markets are trending downwards. The Nasdaq is down 0.2 percent, the Dow Jones Industrial Average is down 0.5 percent, and the S&P 500 is down 0.3 percent amid Trump’s comments.

Meanwhile, Canada released its jobs report amid the ongoing trade dispute with the US. The Canadian economy lost 41,700 jobs, according to Statistics Canada, with the unemployment rate holding steady at 6.4 percent.

“We expect the economy will continue struggling to create jobs in the near term as mounting headwinds from new US-Canada tariffs, greater uncertainty from a flare-up in the trade war, and the ongoing Iran conflict and a shrinking population weigh on hiring,” Tony Stillo, director of Canada Economics at Oxford Economics, said in a note provided to Al Jazeera.

In an exclusive interview, European Union Trade Commissioner Maroš Šefčovič told Euronews that the EU is not in a position to mediate in the trade war between Canada and the United States following the collapse of their trade talks.

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Ten days ago, Canadian Prime Minister Mark Carney walked away from the negotiations with the Trump administration, blaming them for pressuring Canada over the use of the French language.

In the following days, US President Donald Trump announced 50% US tariffs on Canadian cars and trucks, to which Ottawa retaliated with tariffs on more than 700 US imports, worth about $20 billion (€17.2 billion).

“I don’t think that we are in a position to mediate,” Šefčovič said. “At the same time I know that they [Canada and the US] have such a close economic relationship that, despite the current tension, sooner or later there will be attempts to resolve it.”

The Commissioner added that “tariffs are taxes which are paid in the end by the economic operators or by the citizens”, a message he has reiterated several times over the last year during the EU’s own trade dispute with Washington.

“We clearly support free and fair trade with the lower or no tariffs at all,” he told Euronews.

Ready to cooperate

Since the trade talks stopped, Carney has called for a closer relationship between Ottawa and Brussels and announced he will attend European Commission President Ursula von der Leyen’s State of the Union in Strasbourg in mid-September, one of the main events in Brussels’ political calendar.

An EU-Canada summit is also scheduled for later this autumn.

Šefčovič said the Commission is ready to explore “all possibilities” to increase cooperation with Canada, but he added that any new arrangements “would very much also depend on how comfortable the Canadian side would feel and what is its level of ambition”.

He pointed out that after Brussels clinched a trade deal with Ottawa in 2016, trade between the EU and Canada grew by 75% – but he also suggested that the deal could be pushed further.

“On both sides, we have certain elements which we can improve, still certain barriers, certain sensitivities for the products. I really think that we can explore much more that.”

Šefčovič said that a digital agreement might be signed with Canada before the end of the year, and he also cited coming cooperation in critical raw materials with potential joint investments.

Ottawa is seen by Brussels as a like-minded partner sharing its vision of the new global trade order, and Šefčovič hopes to have its backing to get closer to members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which has liberalised trade between 12 countries in the Asia-Pacific region and the Americas, including Canada – but not the US. The UK became the pact’s first and to date only European member in 2024, with Canada ratifying its full accession as of 1 September.

“Canadians are very important partners for forging a new level of cooperation with the CTPPP,” Šefčovič said, “which represents together 40 percent of global trade.”

Canadian Prime Minister Mark Carney has reprimanded the United States for what he describes as a flippant approach to the ongoing trade dispute between the two countries.

On Tuesday, Carney hit back against a series of insults and disparaging remarks from US President Donald Trump and his officials, saying that talks can proceed once Washington takes a more serious approach to the issues at hand.

“When the Americans stop doing memes, stop throwing shade and stop trying to be tough, and start being serious about having those discussions, we can have those discussions,” Carney told reporters in Ottawa. “It’s not constructive, but that’s their democracy.”

The Liberal Party leader’s remarks come as tensions flare once again between the US and Canada, which have historically had tight relations.

But Trump’s second terms have caused those ties to fray. Since returning to office in 2025, Trump has imposed a series of tariffs on Canadian products, prompting retaliatory actions.

The latest round of tariffs came on August 22, when negotiations between the two countries fell through.

As a result, 50 percent tariffs were imposed on roughly $20bn worth of Canadian goods. Canada has pledged to respond with tariffs on US goods, worth roughly the same dollar amount, starting on September 8.

In the aftermath of the failed negotiations, Carney blamed the impasse on last-minute US demands.

He accused the Trump administration of seeking to limit Canada’s ability to cement trade deals with other countries and of requesting changes to laws protecting Canada’s French language and culture.

Carney also said Trump’s team attempted to push an asymmetrical deal that would damage Canada’s industries.

“Canada’s a sovereign state. We will strike free trade deals with the countries we wish to strike free trade deals with,” Carney told reporters on Tuesday. He added, “Of course, we’re not going to accept those terms.”

The trade war between the two countries has prompted a surge of nationalism in Canada.

A June poll from the research firm Abacus Data found that national pride surged 12 points in two years, reaching 77 percent this year.

Carney has faced pressure not to yield to US demands. In addition to imposing steep tariffs, the Trump administration has also pushed Canada to cede its sovereignty and become a “51st state” within the US.

Trump has also taken symbolic actions designed to assert US dominance over the two countries’ shared border region. On August 27, the US president signed an executive order directing federal entities to refer to Lake Ontario as “Lake America”.

“They are one of the worst countries in the world to deal with,” Trump said of Canada in a recent radio interview.

Other cabinet-level officials in the Trump administration have echoed Trump’s remarks disparaging Canada.

US Treasury Secretary Scott Bessent told the news outlet CNBC that Canada’s economy is ill-equipped to handle a trade war with the US, and he blamed Carney for escalating the situation.

“Well, I don’t think you can be in a tit-for-tat with someone who’s 13 times larger than you are,” Bessent said on Monday.

Of Carney, he added, “He came to power on an anti-American, anti-Trump agenda. He was 20 points behind in the polls. And then he started this. And it’s unfortunate that he’s not doing what’s best for the Canadian people.”

US Secretary of Defense Pete Hegseth, meanwhile, posted an image of two female Canadian cadets on social media, in an apparent effort to mock the country’s armed forces.

“This is real,” he wrote beneath the image of the two women, alongside an emoji of the Canadian flag.

Hegseth, a former TV host, has frequently castigated efforts to include women, LGBTQ people and racial minorities in the military as “woke” distractions from the US military’s core mission.

When reporters asked Carney to respond to such messages, he replied that such comments were “beneath” the officials’ office.

“Our plan has always been standing up for Canada, first and foremost, here at home,” Carney said.

US trade officials downplay French language dispute, calling claims fabricated.

Canada’s top trade negotiator with the United States, Dominic LeBlanc, says he “welcomes” a shift in the US position on “discoverability”, “labelling” and “measures to promote French language and Canadian culture” not being subject to US tariffs.

LeBlanc praised the move in a post on Thursday on X and added that Canada is looking “forward to further constructive U.S. clarifications on their other positions, which would create the possibility of a mutually beneficial trade agreement”.

Al Jazeera reached out to the White House for comment, but it pointed to an interview with US Trade Representative Jamison Greer on the Canadian broadcaster CBC in which Greer said French language discoverability on streaming services “is not something where we push hard or condition or red-line”.

Commerce Secretary Howard Lutnick echoed those comments at a news conference on Thursday outside the Kennedy Center in Washington, DC.

“Do I care about how the Quebecois speak? I mean, what could matter less to America? We don’t care. So the fact is we never brought those words up. This is manufactured, and that’s why the president put out a [post on Truth Social] saying it was a complete lie, right? It was manufactured,” Lutnick told reporters.

The comments come on the heels of tit-for-tat tariffs between Washington and Ottawa.

Canada announced retaliatory tariffs on roughly $20bn of US goods ranging from 15 to 50 percent that will go into effect on September 8. Those levies were in response to 50 percent tariffs announced by Washington on Canadian goods as negotiations collapsed over the weekend.

US President Donald Trump ramped up his rhetoric against Canada in recent days, including signing an executive order on Thursday to rename Lake Ontario, the easternmost of the five Great Lakes, which borders Ontario, to Lake America.

On Saturday, Canadian Prime Minister Mark Carney said US officials made “threats to the French language” as well as threats to the culture of Canada and Quebec specifically.

Canada’s retaliatory tariffs are to hit hundreds of consumer products, including ice skates, dishwashers and construction materials. However, on Wednesday, Ottawa scaled back some tariffs, including those on fish and other seafood products.

“Based on feedback, we have made select adjustments to protect against economic harms, including removing seafood and fish products from our list of counter-tariffs,” Canada’s Department of Finance said in a post on X.

“We are continually working with Canadian industries to assess the effectiveness of these measures, with a primary focus on industries that have been targeted by US tariffs.”

Published on
27/08/2026 – 14:10 GMT+2

European Commission President Ursula von der Leyen said on Thursday that if negotiations to reduce the record-high trade deficit with China did not produce a breakthrough, the EU should make use of all its trade defence mechanisms.

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Tensions have remained high between Brussels and Beijing since the talks were launched last June. Over the summer, China moved to ban Chinese firms from participating in EU antitrust probes, while the Commission has continued opening trade defence investigations into the suspected dumping of Chinese products into the European market.

“Dialogue with China remains necessary. But it must produce results. And when dialogue is not enough, we must be ready to make full use of our instruments,” von der Leyen said in remarks to Medef, the French business organisation.

The EU is facing a wave of cheap imports coming from China, which have increased by 45% in five years, the Commission’s President added, pointing out that 30 trade defence investigations have been opened over the last year – “almost three times more than the historical average”.

“We are stepping up investigations significantly,” she said.

Von der Leyen’s remarks come as the EU’s trade deficit with China reaches €1 billion a day. The Commission has set October as a deadline to reach a deal with Beijing to rebalance the trade relationship.

“China is a key economic partner. And our approach is clear and consistent: derisking without breaking ties. But being a partner does not mean accepting permanent imbalances,” von der Leyen said.

Beijing and Brussels have been on the verge of a trade war in recent months, with China threatening several times to retaliate against proposed EU regulations that could reduce market access to Chinese firms.

On Thursday, von der Leyen recalled that all EU member states now record a trade deficit with China.

In June, EU leaders gave her a mandate to act to rebalance the relationship through dialogue as well as the use and review of defence mechanisms. Among these is the EU’s so-called anti-coercion instrument, which can be triggered in case of pressure from a foreign country on the EU to change its policies.

This tool, sometimes referred to as the “trade bazooka”, allows the EU to adopt strong measures such as restrictions on access to public procurement or the removal of intellectual property rights.

However, it requires the support of a majority of the bloc’s member states. It is unclear whether this could be achieved while EU countries continue trading with China on a bilateral basis, seeking access to its market or investments from Beijing.

The warning comes as US President Donald Trump threatens to isolate Iran economically, to weaken its government.

Iran has threatened to treat nearby countries as enemies and target their interests if they join a United States campaign to cripple its economy.

Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, issued the warning in a Saturday interview with state broadcaster IRIB.

“We’re telling all nearby countries not to join the US economic war. Otherwise, we will consider them as enemies,” Rezaei told IRIB.

His remarks come on the heels of escalating economic threats from the administration of US President Donald Trump.

On Wednesday, Trump announced his government would undertake the “most crushing economic operation” yet against Iran, as part of ongoing hostilities between the two countries.

The US and Israel have been locked in a war with Iran since February 28, when the two allies launched an initial volley of attacks against Tehran.

In addition to threatening Iran’s economy this week, Trump pledged “tremendous economic consequences” for any country that gives Iran “any type of lifeline”.

His Treasury secretary, Scott Bessent, echoed his threats the following day, saying, “You’re either with us or against us.”

In Saturday’s interview, Rezaei described Iran’s regional strategy as a three-stage sequence, which would start with efforts to de-escalate tensions with neighbouring countries.

“First we negotiate. Then, we try to separate them from America with pleasant language, because we are not really looking to expand the war,” he said.

Any countries that continue to side with the US would then be given time to reconsider, he said. “But in the third stage, we will definitely act.”

While the US has not stopped its military operations against Iran, Rezaei suggested that the Trump administration was betting that economic pressure would fracture Iranian society, forcing the war to come to an end.

“They hope that, if possible, they can break our unity with economic pressure and a group of protesters will take to the streets, and in a way, they will come to the aid of American F-35s,” he said, referring to a kind of military aircraft.

Negotiations to end the conflict have stalled in recent months, following the failure of a June 17 memorandum of understanding (MoU) that called for an “immediate and permanent termination of military operations”.

Control over the Strait of Hormuz, a major shipping lane off the coast of Iran, has become an enduring sticking point between the US and Iran.

Iran quickly moved to shut down traffic through the strait early in the war, sending the price of goods like oil and fertiliser skyrocketing.

Countries in the Middle East that were previously reliant on the strait for exports have started to pursue substitute trade routes.

But Rezaei warned that Iran would target those alternative oil-shipping routes out of the Gulf if regional states took part in the US’s plans of economic warfare.

Iran’s Ministry of Foreign Affairs on Saturday also decried the incoming US measures as an assertion of “extraterritorial sovereignty” over United Nations member states.

Tehran has also reportedly considered widening its target list beyond the Middle East, with media outlets reporting it could strike US allies in Europe who have supported Trump’s operations.