Key facts
- Donald Trump paused threatened punitive tariffs on Canada.
- The tariffs were set to take effect just hours after the announcement.
- Canadian Prime Minister Mark Carney reported "substantial progress" toward a trade deal.
- The US had previously imposed a 25% tariff on Canada in February 2025.
- Canada retaliated with a reciprocal levy.
- Bilateral trade between the US and Canada was estimated at $909bn in 2024.
President Donald Trump has paused threatened punitive tariffs on Canada just hours before they were scheduled to take effect. Following the announcement, Canadian Prime Minister Mark Carney stated that "substantial progress" had been made toward a trade deal, though further work remains. The decision to pause the tariffs comes after a contentious year for US-Canada relations, marked by reciprocal tariffs and public disagreements. The US had previously imposed a 25% tariff on Canada in February 2025, citing inadequate progress in curbing illegal cross-border immigration and drug trafficking. Canada responded with a reciprocal levy, deeming the US actions "unwarranted and unreasonable."