- US raises steel/aluminum tariffs to 25%, triggering CA$29.8B in Canadian countermeasures
- Carney requires explicit sovereignty guarantees before engaging with Trump administration
- Tensions escalate with Trump's '51st state' remarks and delayed fentanyl-linked tariffs
New Canadian Prime Minister Mark Carney struck a defiant tone Wednesday during a visit to Hamilton's Stelco steel plant, hours after the White House imposed sweeping 25% tariffs on all aluminum and steel imports. With Canada supplying 40% of America's foreign-processed steel, industry analysts warn the measures could disrupt integrated North American supply chains dating back to the 1965 Auto Pact.
Carney emphasized Canada's willingness to collaborate on trade modernization but drew a hard line on sovereignty: 'Any dialogue must begin with mutual respect for national autonomy. We cannot negotiate under annexation threats or economic blackmail.' His comments directly address President Trump's Tuesday claim that the Canada-US border is 'a fictional line we'll erase through strong leadership.'
Regional Impact: Ontario's manufacturing sector, which employs 12% of the province's workforce, faces immediate strain. Hamilton's Stelco plant has already announced a 15% production cut, while Quebec's Alouette aluminum smelter—North America's largest—is stockpiling inventory amid canceled US orders.
Canada's retaliatory measures target CA$14.2B in consumer goods, including Milwaukee power tools and Louisville Slugger baseball bats—a strategic move impacting Republican districts. This follows March's CA$30B counter-tariffs on US dairy and agriculture products. Foreign Minister Mélanie Joly condemned the 'shifting justifications' for US actions, noting: 'First it was border security, now national defense—despite Canadian steel being in every US warship since WWII.'
Industry Insight: Cross-border trade experts highlight three underreported consequences:
1. Small businesses face 22% higher compliance costs under new customs rules
2. Auto sector R&D partnerships are freezing amid uncertainty
3. Renewable energy projects using binational supply chains risk delays
With Trump threatening broader tariffs by April 2, Carney's cabinet is reportedly fast-tracking legislation to diversify exports to the EU and CPTPP nations. However, 68% of Canadian exporters still rely on US customers, per the Business Council of Canada.
