【Epoch Times, August 23, 2025】 Canadian Prime Minister Mark Carney announced on Friday, August 22, that Canada will be lifting several retaliatory tariffs on American goods while strengthening ties with the United States to establish new trade and security relationships.
Carney stated at a press conference in Ottawa that Canada will maintain tariffs on American automobiles, steel, and aluminum for the time being. He highlighted that the recent explicit statement from the United States indicated that Canada’s goods in compliance with the US-Mexico-Canada Agreement (USMCA) will not be subject to tariffs, which he viewed as a positive development.
“In this context, and in accordance with Canada’s commitments under the USMCA, I am announcing today that the Canadian government will simultaneously cancel all tariffs on American goods explicitly covered by the USMCA,” he said.
Carney added, “Canada and the United States have now largely restored free trade for the majority of goods.” He reiterated that overall, Canadian exports are still affected by the low-level tariffs imposed by the United States compared to its trade partners.
He mentioned that this change would come into effect on September 1st. Carney expressed his belief that Canada has the best trade agreement with the United States compared to all countries cooperating with them.
“We are working closely with the United States, with a focus on strategic areas,” he said.
This announcement led to the Canadian dollar continuing its upward trend, with the exchange rate against the US dollar rising by 0.5% to 1.3837 Canadian dollar or 72.27 US cents as of 12:40 PM Eastern Time on Friday.
According to Reuters, a White House official stated, “We welcome Canada’s move, it should have been done sooner. We look forward to continuing discussions with Canada on trade and national security concerns.”
Carney had a phone call with US President Trump on Thursday. When asked if Trump told him that lifting tariffs would initiate negotiations, Carney replied, “Yes.”
This was the first call between the leaders since negotiations failed before the tariff deadline on August 1st. A statement from Carney’s office about the call on Thursday described it as “productive and wide-ranging,” with both leaders agreeing to meet again soon.
In late June, Carney retracted a digital services tax proposal that faced strong opposition from American companies and abandoned rhetoric about further sanctions if an agreement was not reached by August 1st.
Using ice hockey as an example, Carney mentioned that it is time to take a more moderate approach rather than continuing with an aggressive stance.
Under the leadership of Prime Minister Justin Trudeau, Canada swiftly imposed retaliatory tariffs on American goods worth 30 billion Canadian dollars (approximately 21.7 billion US dollars). In July, Trump announced an increase in tariffs on Canada to 35%, citing Canada’s impact on the flow of fentanyl to the US and reluctance to cooperate with the United States as reasons for his decision.