With a 35% duty threatened by the president of USADonald Trump Some products imported from Canada.
At the same time, in addition to the threats against Canada, Trump raised the prospect of increasing duties in most other countries, upgrading his commercial rhetoric in comments that burdened the shares and boosting the US dollar.
The level of duties in Canada will come into force on August 1, the president said. The rate announced is a 25% increase in today’s duty imposed on US imports by Canada not sent under the terms of the US-Mexico-Canada Agreement.
This duty is not currently valid for the goods being trafficked under the rules of the US Commercial Union with Canada and Mexico (USMCA) – and the exclusion is ready to remain in force, according to Bloomberg.
The US is also expected to maintain a lower 10% duty on some energy -related imports, the official said. This move will not affect the highest contributions to basic materials such as steel and aluminum, which fall under a different tariff regime. The situation remains fluid and the legal order has not yet been drafted, they warned. Trump’s tariff plans are unpredictable and are often reviewed, including immediately before a deadline.
“Fentanyl is almost not the only challenge we have with Canada, who has many duties, non -duties, political and commercial obstacles, which are causing non -viable commercial deficits to the United States,” Trump said in a letter to Canadian Prime Minister Prime Minister Mark.
As it is today, the formula would be a much more moderate change in the trade relationship than a horizontal coefficient of 35%. Most of Canada’s exports to the US fall under USMCA rules.
It will maintain exceptions in narrowly integrated areas such as the automotive industry, where the flow of trade between the two countries is quite balanced. Canada is by far the largest foreign market for US vehicles, importing about 629,000 American cars and light trucks last year, according to US government data.
However, the letter suggests that Trump intends to step up instead of reducing his trade war with the US northern neighbor – for which he has been publicly wondering that he should consider the 51st state – despite the angry efforts of Canadian officials.
“It is indicative of how unstable these negotiations are,” said Flavio Volpe, head of the Association of Parts Manufacturers of Car Spareers, a Canadian industrial team.
Trump’s announcement came as he told NBC News on Thursday that it also examines the imposition of 15% to 20% of the duties on most commercial partners. Today’s worldwide basic minimum tariff rate for almost all US trade partners is 10%.
All in all, these moves do not signal any retreat from the flagship of his economic policy, with Trump noting the recent rise in US market markets, even when designing higher tariff rates on major commercial partners.
Futures’ contracts for the future of US shares fell, while the dollar was raised against its main bonds in Asian transactions. The US dollar quickly scored a 0.6% jump against the corresponding Canadian after posting the president’s account on social media before limiting that profits.
The president spent the week sending messages to the commercial partners, informing them of the new prices that will come into force on August 1 if they could not negotiate better terms. Letters to members of the European Union are also expected soon.
The letter to Canada is “a big shock, which still matters to the Canadian economy, and the pace at which it issues these letters and threatens to impose universal duties on other countries is very, very negative for financial markets in general,” said Karl Schamotta, head.
“It seems that the negotiations between Trump and Canada and many other countries are essentially irrelevant to the process. And so, unfortunately, the interpersonal relationship that many leaders have invested in building with Mr Trump, this effort is largely lost,” he said.
Trump’s announcement for Canada came after Ottawa officials denounced US plans to impose a 50% import duty on copper. Canada is one of the largest metal suppliers in the US.
“We are waiting for the details of this decision from the White House and the President, but we will fight against her, dot and dash,” Canada’s Melanie Joly Industry Minister said earlier on Thursday, referring to copper duties.
Talks between the US and Canada had already presented signs of tension. Last month, Trump interrupted the negotiations briefly after Canada implemented a digital service tax, just for the Canadian government to withdraw the initiative.
‘Use our choices’
While the majority of Canadian exports to the US are protected by Trump’s duties thanks to the USMCA trade agreement, the president had signed an executive decree on imposing 25% of the goods on many goods, citing the threat of fentanyl. Products qualify for USMCA exemption if they comply with the rules of that agreement.
The trade agreement, for example, sets a complex set of ‘rules of origin’ for automotive accessories. Only cars and trucks that meet a minimum level of North American content are considered compatible with USMCA.
Metals, including steel and aluminum, are currently subject to a 50%duty.
“It further resolves Canada’s efforts to find new commercial partners,” said Heather Exner-Pirot, a senior associate at the MacDonald-Laurier Institute in Ottawa. “We have a surplus of food, energy and critical minerals. We are a reliable trading partner that does not bring commitments. We need to make use of our choices.”
The US government shows that very little fentanyl, a highly addictive drug, is being traveled through the US-Canadian border.
Trump allowed him to “examine an adaptation of this letter” if Canada was working with him to stop the flow of Fentanyl. But he criticized the Canadian authorities for existing tariffs on US dairy products and said the government has “made financial retaliation against the United States”.