Trump Scores Trade Win As Canada Removes Several Retaliatory Tariffs On U.S.

President Donald Trump notched a major trade win Friday as Canadian Prime Minister Mark Carney announced that Canada will suspend the majority of its retaliatory tariffs on U.S. goods. The move comes just weeks after the Trump administration reaffirmed its commitment to the U.S.-Mexico-Canada Agreement (USMCA), solidifying America’s leverage in the ongoing economic dispute.

While Canada will maintain a 25% duty on select U.S. steel, aluminum, and vehicle imports—products not directly covered by USMCA—the country is rolling back most of the duties it imposed earlier this year in response to Trump’s tariffs on Canadian metal exports.

Carney acknowledged the significance of the U.S. reaffirmation and called the development “positive and very important.” He confirmed that the actual U.S. tariff rate on Canadian goods now stands at 5.6%, well below the global average of 16%. Over 85% of Canada-U.S. trade is now completely tariff-free.

“This proves once again that Canada has the best trade deal with the United States,” Carney declared. “And it’s because the United States reaffirmed that compliant Canadian exports will not face new tariffs under USMCA.”

President Trump signed a 35% tariff order on Canadian imports in July, prompting Carney’s government to slap retaliatory measures on U.S. goods in March. But Friday’s reversal marks a sharp shift in tone and strategy, with Bloomberg describing Canada’s move as an “olive branch” to Trump.

A senior White House official, speaking to CNBC, called Canada’s retreat “long overdue” and said that recent private warnings from Commerce Secretary Howard Lutnick played a key role in nudging Ottawa toward de-escalation.

The breakthrough followed a phone call between Carney and Trump that the Canadian prime minister described as “productive and wide-ranging.” Trump reportedly emphasized that the U.S. would not tolerate protectionist games from its northern neighbor.

Though some tariffs remain, particularly on steel and autos, the broader Canadian capitulation reinforces Trump’s tough negotiating approach. According to the White House, the president’s use of targeted tariffs has brought adversaries to the table while protecting American industry and workers.

The USMCA, Trump’s signature trade agreement replacing NAFTA, is set for review later this year. Carney hinted that Canada is open to further talks, stating his desire to explore a “new form of trade and security partnership” with the United States.

For now, Trump’s message is clear: play fair or face consequences. And in this round, Canada blinked.