A University of Windsor political scientist calls Canada's removal of counter-tariffs on U.S. products 'a good step.'
Lydia Miljan told CTV News that tariffs are bad because they're a tax on consumers, but she says that the big question is what are we going to do about the sectoral tariffs on the auto, aluminium, and steel sectors?
Miljan is also worried about what Canada is going to give up once renegotiations begin for the Canada-United States-Mexico Agreement.
Prime Minister Mark Carney announced Friday that Canada is dropping some retaliatory tariffs on American products to match U.S. tariff exemptions for goods covered under the Canada-United States-Mexico Agreement (CUSMA), but Canada will retain tariffs on steel, aluminium, and autos as it works with the U.S. to resolve issues.
The decision will take effect on Sept. 1, 2025.
Miljan says Carney didn't really give anything up in making this announcement.
"The Americans had already signalled that they weren't going to be tariffing CUSMA products. So it makes no sense for us to be doing the same thing," she says. "We can't say we have an agreement, why aren't you living by it, and then not live by it ourselves? I think the big challenge and the big concern is what we are going to do in our negotiations for the new trade agreement."
Canada imposed 25 per cent tariffs on a long list of American goods in March, including oranges, alcohol, clothing and shoes, motorcycles, and cosmetics.
The American administration has imposed 50 per cent tariffs on steel and aluminium; Canada's countertariffs on those industries will remain at 25 per cent.
Miljan says she's somewhat concerned about what we give up once we get to the CUSMA negotiations.
"He's making it sound like we have the best agreement in the world, which is great for now, but it's going to be renegotiated, and we know Mr. Trump is not a very reliable trading partner," she says. "That's the concern; they've already signalled they're going to give up the digital services tax. Are they going to be selling out other sectors?"
Carney told Friday's news conference that Canada and the U.S. have re-established free trade for the vast majority of goods.
Carney says the Canadian government will begin its preparations for the CUSMA review process due next year by launching consultations starting next month.