Trump backs down on 50% Canada tariff as Ontario halts surcharge
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More news: The Trump administration backed off plans to double tariffs on Canadian steel and aluminium after Ontario suspended its planned 25% surcharge on electricity exports to the US.
The White House told media in a statement that the 25% tariffs on metals, “with no exceptions or exemptions,” will go into effect for Canada and all other trading partners from Wednesday midnight (3pm AEDT).
The move came hours after Trump had announced the 50% tariffs in response to Ontario’s surcharge, which targeted Michigan, New York and Minnesota.
However, Ontario Premier Doug Ford later suspended the measure after discussions with US Commerce Secretary Howard Lutnick.
Meanwhile, market uncertainty continued, with the Dow Jones closing 1.14% lower and the S&P 500 Index closed down 0.76%, following a 2.7% plunge on Monday - its worst one-day drop since December.
What they said: Ford and Lutnick will meet in Washington on 13 March to discuss a renewed USMCA trade agreement ahead of reciprocal tariffs set to take effect on 2 April, according to a joint statement by the officials posted on social media.
Later, at a White House event featuring a Tesla car, Trump told reporters he was "probably so" going to reduce tariffs on Canada following Ontario’s decision, but the 25% steel and aluminium tariffs remain.
US to require registration for Canadians staying over 30 days
More news: Canadians who stay in the US for more than 30 days will soon be required to register their information with the US government and be fingerprinted, according to a draft rule obtained by ABC News.
Canadians staying in the US for more than 30 days have traditionally not been required to register with the federal government.
The change takes effect on 11 April and applies to those who were not issued a regular I-94 travel document at entry ABC and Bloomberg reported. Affected individuals must complete a new Form G-325R, create an account with US Citizenship and Immigration Services, and schedule a fingerprinting appointment as part of a background check.
The context: The change comes amid escalating trade tensions between Trump and Canada. It is unclear whether the rule, set to be published in the Federal Register, was introduced as part of that dispute.
Last month, the Department of Homeland Security announced plans to "fully enforce" the Immigration and Nationality Act to "track illegal aliens and compel them to leave the country voluntarily."
The act requires noncitizens over 14 to register and be fingerprinted within 30 days and for those over 18 to carry proof of registration.
Trump doubles Canadian metal tariffs to 50% in escalating trade war
The news: US President Donald Trump announced he is doubling tariffs on Canadian steel and aluminium from 25% to 50%, blaming Ontario’s recent decision to impose a 25% surcharge on electricity exports to the US.
The tariffs take effect on 12 March.
Trump also threatened to "substantially increase" tariffs on Canadian auto parts on 2 April – which he said “will, essentially, permanently shut down the automobile manufacturing business in Canada.” – if Canada does not drop what he said were “outrageous” tariffs on US dairy products and other goods.
He will declare a "national emergency on electricity" in response to Canada’s measures, Trump added. Canada has also imposed tariffs on US goods, including orange juice and footwear.
In the lengthy social media post, Trump forcefully repeated his demand for Canada to become the 51st US state, claiming it would "make all tariffs, and everything else, totally disappear."
The context: Trump’s tariff escalation comes as Canada prepares for a leadership change, with Mark Carney set to replace Justin Trudeau as prime minister.
His move could impact US businesses as Canada is the main source of aluminium for US industry, and the auto plants he is threatening are owned by US automakers.
Ontario Premier Doug Ford, a prominent conservative politician, introduced the electricity tariffs impacting New York, Minnesota and Michigan amid widespread Canadian outrage over Trump’s tariffs and his repeated suggestions that the US should annex Canada.
Ford said he would not back down until Trump’s tariffs are "gone for good," and has previously said he would not hesitate to shut the electricity off completely, if Trump escalates.
Trump said Canada had "outrageous" tariffs of between 250% and 390% on dairy products, referencing its supply management system, which imposes high duties on imports above a set quota.
Under the USMCA, Canada allows tariff-free imports of specific amounts of US dairy products each year, but CNN noted the US has not reached those limits in any category. While Trump claimed Canada "kept raising" these tariffs under Biden, official records show they remained unchanged from when Trump signed the USMCA in 2018, the publication said.
The numbers: Economists are concerned Trump’s tariff actions are fuelling uncertainty, with US business and consumer confidence falling. The S&P 500 dropped 0.5% after Trump’s post on Tuesday, following a 2.7% plunge on Monday, its worst one-day drop since December. The Toronto Stock Exchange declined about 0.5%, and the Canadian dollar weakened.
Investors are increasingly concerned Trump's trade policies could push up inflation and trigger a recession.
What they said: Trump called Canada an "abusive threat" and "one of the highest tariffing nations anywhere in the world."
“If other egregious, long time Tariffs are not likewise dropped by Canada, I will substantially increase, on April 2nd, the Tariffs on Cars coming into the U.S. which will, essentially, permanently shut down the automobile manufacturing business in Canada. Those cars can easily be made in the USA!” he said.
“Also, Canada pays very little for National Security, relying on the United States for military protection. We are subsidizing Canada to the tune of more than 200 Billion Dollars a year. WHY??? This cannot continue. The only thing that makes sense is for Canada to become our cherished Fifty First State. This would make all Tariffs, and everything else, totally disappear. Canadians’ taxes will be very substantially reduced, they will be more secure, militarily and otherwise, than ever before, there would no longer be a Northern Border problem, and the greatest and most powerful nation in the World will be bigger, better and stronger than ever — And Canada will be a big part of that. The artificial line of separation drawn many years ago will finally disappear, and we will have the safest and most beautiful Nation anywhere in the World — And your brilliant anthem, “O Canada,” will continue to play, but now representing a GREAT and POWERFUL STATE within the greatest Nation that the World has ever seen!”
In a social media post, Ford said: “President Trump’s tariffs are causing chaos. Markets are tanking. He needs to drop his tariffs and come to the table to negotiate a fair trade deal. Until he does, we won’t back down.”
The sources: Donald Trump post, Doug Ford post, ABC News, Bloomberg
