Hours after threatening to double incoming tariffs set for Wednesday on Canadian steel and aluminum, the White House says U.S. President Donald Trump is keeping them at their original rate of 25 per cent.
The confirmation ended a day of escalating threats that started with Trump saying steel and aluminum tariffs on Canada will go up to 50 per cent, in response to Ontario’s decision to impose a 25 per cent tariff on electricity imports to the U.S. That move was in retaliation against Trump’s 25 per cent blanket tariffs from earlier this month, escalating the trade war between Canada and the U.S.
After Ontario Premier Doug Ford said he would remove the electricity surcharge following a conversation with the White House, Trump backed off his threat to increase the steel and aluminum tariffs, according to a White House statement.
“President Trump has once again used the leverage of the American economy, which is the best and biggest in the world, to deliver a win for the American people,” the statement said.
“Pursuant to his previous executive orders, a 25 per cent tariff on steel and aluminum with no exceptions or exemptions will go into effect for Canada and all of our other trading partners at midnight, March 12.”
Speaking on the White House lawn on Tuesday, Trump said he “respects” Ontario’s decision and called Ford a “gentleman.”
“There’s a very strong man in Canada who said he was going to put a surcharge or a tariff on electricity coming into our country. He has called and said he’s not going to do that. It would have been a very bad thing if he had done that, but he said he’s not going to do that, and I respect that,” he said.
Ford said he had spoken to U.S. Commerce Secretary Howard Lutnick and was invited to the White House for a meeting on Thursday, alongside federal Finance Minister Dominic LeBlanc. It was not clear if Trump would attend the meeting.
“It’s called an olive branch,” Ford said to reporters earlier Tuesday afternoon.
“When you’re negotiating with someone, they call you and they hand over an olive branch, the worst thing I think I could do as Premier of Ontario is ignore them and hang up the phone on them. I don’t operate that way — I believe when someone’s putting out an olive branch we sit back, we accept it graciously, by the way, thank them for that opportunity and let’s start moving.”
Earlier on Tuesday, Trump took to Truth Social to announce the higher tariffs.
“Based on Ontario, Canada, placing a 25% Tariff on ‘Electricity’ coming into the United States, I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD. This will go into effect TOMORROW MORNING, March 12th,” Trump posted on Truth Social.
Stock markets in the U.S. and Canada slid further Tuesday after Trump’s announcement, extending a more than week-long period of whipsawing activity on Wall Street and Bay Street. The Trump administration has sought to dismiss concerns that the market turmoil is impacting Americans’ investments and retirement plans.
According to the Aluminum Association of Canada, the U.S. relies on Canada for 75 per cent of its imported primary aluminum.
Trump said he would “permanently shut down” the automobile manufacturing industry in Canada if Ontario did not back down. Exemptions for auto components from sweeping 25 per cent tariffs on Canadian goods will also expire April 2, which is when “reciprocal” tariffs on all countries are set to kick in.
“I will shortly be declaring a National Emergency on Electricity within the threatened area. This will allow the U.S to quickly do what has to be done to alleviate this abusive threat from Canada. 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,” he said.
Ford hit back hours after Trump’s announcement, saying that Ontario and Canada would “not back down.”
“We will not back down. We will continue on this. I apologize to the American people that President Trump decided to have an unprovoked attack on our country, on families, on jobs,” Ford said speaking to U.S. news network MSNBC.
He added, “I’m not too sure why he continues to attack his closest friends and allies. But we need the American people to speak up. We need those CEOs to actually get a backbone and stand in front of him and tell him this is going to be a disaster. It’s mass chaos right now. “
Yet hours later, Ford said his government was suspending its 25 per cent surcharge on electricity exports to three U.S. states after securing a meeting in Washington with Lutnick.
“Today, United States Secretary of Commerce @howardlutnick and Premier of Ontario Doug Ford had a productive conversation about the economic relationship between the United States and Canada,” a joint statement posted on Ford’s X account Tuesday afternoon said.
“Secretary Lutnick agreed to officially meet with Premier Ford in Washington on Thursday, March 13 alongside the United States Trade Representative to discuss a renewed USMCA (United States-Mexico-Canada Agreement) ahead of the April 2 reciprocal tariff deadline. In response, Ontario agreed to suspend its 25 per cent surcharge on exports of electricity to Michigan, New York and Minnesota.”
Trump on Tuesday repeated his threat of making Canada the 51st state of the United States, claiming it would do away with any disputes over trade and military spending.
“Frankly, the way that gets solved is Canada should honestly become our 51st state,” he told reporters outside the White House, reiterating comments he made earlier on Truth Social. “We wouldn’t have a northern border problem, we wouldn’t have a tariff problem.
“By the way, when you get rid of that artificial line that looks like it was done with a ruler — and that’s what it was, some guy sat there years ago and they said ‘rah,'” Trump continued, making a cutting motion with his arm. “When you take away that and you look at that beautiful formation of Canada and the United States, there is no place anywhere in the world that looks like that. And if you add Greenland it looks even better.”
A spokesperson for Liberal Leader Mark Carney, who will be sworn in as prime minister shortly, said in a statement the threat of increased tariffs were an “attack” on Canadian workers, families, and businesses.
“My government will ensure our response has maximum impact in the U.S. and minimal impact here in Canada, while supporting the workers impacted,” the statement reads.
“My government will keep our tariffs on until the Americans show us respect and make credible, reliable commitments to free and fair trade.”
Industry groups in Canada are sounding the alarm.
“This policy is proven to fail. The last time these sectors were tariffed during President Trump’s first term, there was a net loss of tens of thousands of American blue-collar jobs. And that was at 25% tariffs on steel and 10% on aluminum. Both the increase and the potential of compounding tariffs will make this go-around significantly more painful and more expensive,” Candace Laing, president and CEO of the Canadian Chamber of Commerce said.
White House press secretary Karoline Leavitt said Trump made his position on tariffs “quite clear.”
“The president saw the premier, Doug Ford, make an egregious and insulting comment, threatening to shut down electricity for the American people, for hardworking American families. He made that threat. The president saw that and he has an obligation and a responsibility to respond accordingly and represent the interests of the American people,” Leavitt said.
Asked if the Trump administration still considers Canada a close ally, Leavitt responded that Canada is “a neighbour, they are a partner, they have always been an ally. Perhaps they’re becoming a competitor now.
“As the president also laid out in his Truth Social post today, he believes that Canadians would benefit greatly from becoming the 51st state of the United States of America,” she said.
Conservative Leader Pierre Poilievre called Trump’s escalation “yet another betrayal” of the “long friendship between Canada and the United States.”
“I am calling on the government to immediately bring in retaliatory tariffs to respond to this unjust act and to protect Canadian steel and aluminum workers. If President Trump is applying 50 percent tariffs on our steel and aluminum, then Canada must hit back with 50 percent tariffs on all steel and aluminum imported from the United States,” Poilievre said in a statement Tuesday.
David Adams, president and CEO of Global Automakers of Canada, said, “All these decisions seem to be happening not only on a daily basis, but sometimes on an hourly basis.”
He warned that Americans would suffer the consequences of Trump’s trade war.
“They (steel and aluminum tariffs will) come back to effectively haunt the American consumer, whether those consumers be businesses or individual retail consumers,” he added.
Last month, Trump signed a pair of presidential proclamations that will impose 25 per cent tariffs on foreign steel and aluminum starting March 12, with no exceptions or exemptions.
Trump’s additional tariff on Canada will be stacked on top of these tariffs.
—with files from Global News’ Sean Previl
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