Trump Escalates Trade War With Canada Following Move to Recognize Palestinian State
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by Reuters and Algemeiner Staff
US President Donald Trump and Canadian Prime Minister Mark Carney attend a meeting with G7 leaders and guests, at the G7 summit in Kananaskis, Alberta, Canada, June 16, 2025. Photo: REUTERS/Kevin Lamarque
US President Donald Trump intensified his trade war with Canada a day ahead of his August 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.
Trump is set to impose a 35 percent 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,” 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 of US goods last year and exported $412.7 billion to the US, according to US Census Bureau data.
Canada is also the top supplier of steel and aluminum to the United States, and faces tariffs on both metals as well as on vehicle exports.
Last month, Carney’s government scrapped a planned digital services tax targeting US technology firms after Trump abruptly called off trade talks saying the tax was a “blatant attack.”
Carney followed France and Britain as he said on Wednesday that his country was planning to recognize a Palestinian state at a meeting of the United Nations in September.
In announcing the decision, 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 Carney’s comments.
Carney’s office did not immediately respond to a request for comment on Trump‘s post.
