U.S. President Donald Trump has stated that he will double the planned tariffs on steel and aluminum imposed on Canada, thereby escalating the trade war with the northern neighbor. This move signifies a further strain on U.S.-Canada trade relations, potentially having a significant impact on both countries' economies.
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03-12, 2025President Trump also posted on his social media platform, Truth Social, stating, "The only thing that makes sense is for Canada to become our beloved 51st state." Furthermore, he vowed to declare a national power emergency in response to Ontario's threat to suspend electricity exports to three U.S. states. These actions indicate a hardening stance from the U.S. side.
Previously, Ontario Premier Doug Ford announced that Ontario would impose a 25% surcharge on electricity it provides to the U.S. states of Minnesota, New York, and Michigan. Ford stated, "I won’t hesitate to increase that charge. If the U.S. escalates, I won’t hesitate to cut off the power completely." However, after negotiations, Ford has temporarily shelved the plan to impose the 25% surcharge on electricity.
In response, Trump stated that he has directed the Commerce Secretary to increase the 25% steel and aluminum tariffs imposed on all U.S. importers to 50%, specifically targeting Canada. The increased tariffs will take effect starting Wednesday. Canadian Prime Minister-designate Mark Carney described the increased tariffs as an "attack" on Canadian workers, families, and businesses. He stated that his government will continue to maintain retaliatory tariffs "until the Americans respect us and make a credible, reliable commitment to free and fair trade."
In addition to Canada, Australia has also failed to obtain an exemption from U.S. steel and aluminum tariffs. Ford, in response to Trump's raising of electricity prices, stated that American business leaders and citizens need to stand up against the "chaos" caused by Trump's launching of a trade war. Ford told MSNBC, "If we go into a recession, it will be because of one person. It's called President Trump's recession. It doesn't have to be this way. Our two countries should be thriving."
Alarmed by the potential economic impact of the tariffs, the stock market has recently fallen. On Sunday, Trump, in an interview with Fox News, stated that the U.S. is experiencing a "transition period" when asked if the U.S. faces a recession. The S&P 500 Index fell 2.7% on Monday (local time), erasing the gains made after Trump's victory in November 2024. The index further fell 0.8% in trading on Tuesday morning.
