US President Donald Trump announced on social media that he is immediately terminating trade talks with Canada amid escalating tensions over Ottawa’s plan to enforce a tax targeting large technology firms.
The two countries had been aiming to finalise a trade agreement by mid-July, but Trump’s decision threatens to derail progress.
The US and Canada have already imposed tariffs on each other’s goods following a trade dispute earlier this year, during which Trump controversially threatened to annexe Canada through “economic force”.
On Friday, Trump criticised Canada’s 3% digital services tax on tech giants, branding it an “egregious tax.” He also warned of new tariffs on Canadian imports set to be announced within the coming week.
“We are hereby terminating ALL discussions on Trade with Canada, effective immediately,” Trump posted online.
He added, “We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven-day period.”
In response, Canadian Prime Minister Mark Carney expressed optimism, suggesting negotiations would continue despite the US president’s announcement.
“We will continue to conduct these complex negotiations in the best interest of Canadians,” Carney told reporters.
The tax, introduced last year, has been a major point of contention in US-Canada relations, with American firms such as Amazon, Apple, and Google expected to face an additional cost of over $2 billion annually.
Canadian officials had hoped to resolve the dispute as part of the ongoing trade talks. There were also expectations that the relatively cordial relationship between Carney and Trump might facilitate a compromise.
However, Trump’s latest public break from the negotiations casts doubt on a swift resolution. His frequent use of social media to make bold threats is widely seen as a tactic to gain leverage or accelerate stalled talks.
