Prime Minister Mark Carney says Canada lifts US tariffs, aims for stronger trade ties

Canada will remove all tariffs on US goods compliant with the North American free trade agreement, Prime Minister Mark Carney announced. Photo / Getty Images

Canada will remove all tariffs on US goods that are compliant with the existing North American free trade agreement, Prime Minister Mark Carney has said, matching exemptions affirmed earlier this month by Washington.

President Donald Trump called the move “nice”.

Speaking to reporters a day after a lengthy call with Trump, Carney said Canada has “the best deal of any country with the United States right now”.

Following a series of agreements the United States has signed with major partners including the European Union, Carney said it was clear the Trump administration is compelling countries “to buy access to the world’s largest economy”.

He said the average tariff rate on goods entering the United States from around the world was now at 16%, up from 2% before Trump took office.

The US tariff rate on Canadian goods was 5.6%, the Prime Minister said, adding “85% of our trade is tariff-free”.

Carney has said it was crucial the United States decided earlier this month to maintain its tariff exemption on all goods compliant with the United States-Mexico-Canada Agreement (USMCA).

Effective on September 1, Canada will match that exemption as a goodwill gesture, as it aims to “intensify” discussions with the Trump administration on a broader trading relationship, the Prime Minister said.

Carney, a former competitive hockey player, said the decision to remove some counter-tariffs reflected the evolving stages of those negotiations.

“There is a time in the game ... [when] we dropped the gloves in the first period to send a message,” he said, using hockey terminology for punching an opponent.

“There’s also a time in the game ... [when] you want to put the puck in the net,” he said, stressing Ottawa was now focused on clinching a deal that could offer long-term benefits for the Canadian economy.

Asked if he had received assurances from Trump on Thursday (local time) that the tariff announcement would help kickstart talks on a broader trade deal, Carney said “yes”.

Trump said he “had a very good talk” with Carney.

“I like Carney a lot. I think he’s a good, good person,” the President said.

Carney also stressed his Government was focused on preparing for USMCA revision talks set for next year, a timeline agreed by all sides when the deal was signed during Trump’s first term.

Trump’s global sector-specific tariffs – namely those targeting all auto, steel and aluminium imports – have done the most damage in Canada.

“Canada will retain our tariffs on steel, aluminium and autos as we work intensively with the US to resolve the issues there,” Carney said.

“Our focus now is squarely on these strategic sectors and the future.”

– Agence France-Presse