President Donald Trump said Tuesday that he was delaying the planned 50% U.S. tariffs on $20 billion worth of Canadian imports after the two countries reached a last-minute agreement just hours before the measures were set to take effect.
Trump made the announcement on his social media platform, giving the two countries additional time for negotiations and, for now, avoiding another escalation in already strained relations between the longtime allies.
“I have paused the 50% Tariffs against Canada, that were scheduled to kick in tomorrow morning for a three day period, based on the fact that Canada and the U.S.A., subject to the finalization of documents, have a DEAL!” Trump wrote on Truth Social less than two hours before the 12:01 a.m. Wednesday deadline.
The tariffs would have affected about 5% of Canada’s annual exports to the United States, covering a wide range of products from hockey sticks to tongue depressors.
However, the political consequences could have been more significant than the economic impact. Canada had threatened to impose retaliatory tariffs in response to any new U.S. duties, potentially worsening a trade dispute between the two countries.
The United States and Canada exchanged about $880 billion worth of goods and services last year, underscoring the importance of their longstanding economic relationship.