Washington and Ottawa pull back from the brink of a fresh trade war as the US president announces a three-day pause on 50 per cent levies, citing progress on a landmark economic agreement.
A midnight reprieve
Donald Trump announced late on Tuesday evening that he would suspend the introduction of sweeping new 50 per cent tariffs on Canadian goods, just hours before they were due to take effect at midnight. The dramatic reversal came after the two countries reached the outlines of a deal, the US president said.
The tariffs would have applied to roughly $20 billion worth of Canadian imports and were set to be imposed regardless of whether the goods qualified for preferential treatment under the existing US–Mexico–Canada trade agreement, which has shielded large parts of Canadian industry from earlier American duties.
A deal in principle
In a post on his Truth Social platform, Trump said he had paused the measures “based on the fact that Canada and the United States, subject to the completion of paperwork, have made a deal.”
According to reports, the agreement is expected to include comprehensive market access for all American goods, commitments on economic security, and the alignment of digital trade rules, among other provisions.
In a separate statement published on the White House website, the president said he had received assurances from Canada that it would address longstanding US concerns over tariffs on dairy products, alcoholic beverages and automobiles.
Cautious optimism in Ottawa
An hour after Trump’s announcement, Canadian prime minister Mark Carney struck a measured tone. “Substantial progress has been made, though much important work remains,” he said in a statement.
The pause provides a brief window for negotiators on both sides to finalise the details of an agreement that could reset the terms of one of the world’s largest bilateral trading relationships.
