Trump escalates trade war with Canada following Palestine stance
Canada is also the top supplier of steel and aluminium to the United States.
US President Donald Trump intensified his trade war with Canada a day ahead of his Aug 1 deadline for a tariff agreement, saying it would be 'very hard' to make a deal with
Canada after it gave its support to Palestinian statehood .
Mr Trump is set to impose a 35 per cent tariff on all Canadian goods not covered by the US-Mexico-Canada trade agreement if the two countries do not reach an agreement by the deadline.
'Wow! Canada has just announced that it is backing statehood for Palestine. That will make it very hard for us to make a Trade Deal with them,' Mr Trump said on Truth Social.
Canadian Prime Minister Mark Carney previously said tariff negotiations with Washington had been constructive, but the talks may not conclude by the deadline. Talks between the two countries were at an intense phase, he added, but a deal that would remove all US tariffs was unlikely.
Canada is the second-largest US trading partner after Mexico, and the largest buyer of US exports. It bought $349.4 billion (S$451.9 billion) of US goods in 2024 and exported US$412.7 billion to the US, according to US Census Bureau data.
Canada is also the top supplier of steel and aluminium to the United States, and faces tariffs on both metals as well as on vehicle exports.
In June, Mr Carney's government scrapped a planned digital services tax targeting US technology firms after Mr Trump abruptly called off trade talks, saying the tax was a 'blatant attack.'
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Mr Carney followed France and
Britain as he said on July 30 that his country was planning to recognise the State of Palestine at a meeting of the United Nations in September.
In announcing the decision, Mr Carney spoke of the reality on the ground, including starvation in Gaza.
'Canada condemns the fact that the Israeli government has allowed a catastrophe to unfold in Gaza,' he said.
Israel and the United States, Israel's closest ally, both rejected Mr Carney's comments.
Mr Carney's office did not immediately respond to a request for comment on Mr Trump's post. REUTERS
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