In a dramatic escalation of his trade war strategy, U.S. President Donald Trump has threatened Canada with a 35% tariff on exports, set to begin on August 1. This latest move, revealed in a letter sent Thursday to Prime Minister Mark Carney, marks the most recent in a series of aggressive trade actions taken by Trump, following more than 20 similar letters sent to countries worldwide since Monday.
The imposition of tariffs comes as the United States, Canada, and Mexico engage in ongoing trade talks aimed at negotiating the terms of the United States-Mexico-Canada Agreement (USMCA), a replacement for the North American Free Trade Agreement (NAFTA). However, the impending deadline, set for July 21, now appears to be in jeopardy following Trump’s renewed trade threats.
“Throughout the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and businesses. We will continue to do so as we work towards the revised deadline of August 1,” Carney posted on social media platform X on Thursday night.
Trump’s actions come after years of strained relations between the U.S. and its North American neighbors. While the USMCA was originally set to be reviewed by July 2026, the latest tariff threat throws that timeline into uncertainty. Canada and Mexico are both working to appease Trump’s demands in order to reinstate the free trade deal that has governed cross-border commerce for decades.
In the past, Canadian and Mexican products were initially hit by tariffs of 25%, with exemptions made for specific energy-related goods. The tariff targets were aimed at addressing what Trump saw as insufficient efforts by the two countries to combat illegal immigration and the illicit flow of drugs.
Relations between Trump and Carney, however, had shown signs of thawing in recent months. After meeting in May, Carney and Trump held a cordial discussion in the Oval Office. A subsequent meeting at the G7 summit in Canada also appeared to signal a shift toward more collaborative dialogue, with world leaders urging Trump to back off from his aggressive trade war.
Despite this, Trump has made it clear that he will continue to pursue his tariffs as a tool for pressuring foreign governments. In a separate interview with NBC, Trump revealed he is also contemplating imposing tariffs of between 15% and 20% on additional countries that have yet to receive one of his letters, including members of the European Union.
In response to his own tariff threats, Brazilian President Luiz Inácio Lula da Silva stated Thursday that he was open to negotiation with the U.S., but also made clear that Brazil would consider reciprocal measures if the tariffs are enforced. The Brazilian president also took the opportunity to criticize the treatment of former Brazilian President Jair Bolsonaro, a political ally of Trump.
Trump’s tariff letters are becoming a regular tool in his trade diplomacy, with the president clearly determined to reshape global trade terms in favor of U.S. interests. His rhetoric regarding Canada’s potential status as the 51st U.S. state has also persisted, reflecting his broader goals of integrating North America under American terms.