Canada has announced retaliatory tariffs on billions of dollars' worth of US goods, escalating an ongoing trade dispute between the two North American neighbors after Washington imposed new duties on selected Canadian exports.

Speaking at a press conference in Ottawa, Canadian Finance Minister François-Philippe Champagne said the new measures will take effect on September 8 and apply to approximately C$27.6 billion (about US$28 billion) worth of imports from the United States.

Under the plan, affected US products will face tariffs of 15%, 25% or up to 50%, depending on the category. Champagne said the rates were designed to mirror tariffs already imposed by Washington on comparable Canadian exports.

"Our tariffs will match those imposed by the United States on similar Canadian goods," Champagne said, adding that Canada's existing tariffs on products such as automobiles would remain in force.

Trade tensions deepen

The latest move follows Washington's decision to impose 50% tariffs on certain categories of Canadian imports beginning on August 22, after US officials said Ottawa had withdrawn from a bilateral trade arrangement favored by the Trump administration.

US Trade Representative Jamieson Greer said Canada had stepped away from negotiations on a trade framework that Washington considered beneficial, prompting the latest round of tariff measures.

Canadian Prime Minister Mark Carney confirmed that trade negotiations with the United States had been suspended and accused Washington of triggering a "trade war" between the two allies.

Trump signals further measures

US President Donald Trump has also announced plans to impose 50% tariffs on Canadian automobiles, auto parts and steel beginning January 1, 2027.

Trump argued that Canada had benefited from preferential trade arrangements with the United States for years and said his administration would no longer tolerate what he described as unfair treatment. He also warned Ottawa against further escalating trade and diplomatic tensions.

The exchange of retaliatory measures marks another sharp deterioration in US-Canada economic relations, raising concerns over the impact on cross-border trade, manufacturing supply chains and investment between the two countries.(ILKHA)