Canadian PM Carney says new US tariffs are 'designed to hurt us and divide us'

Canadian Prime Minister Mark Carney has hit out at new US tariffs on Canada, saying they were "designed to hurt us and divide us" after talks between Ottawa and Washington broke down on Friday.

Sharing further details on why Canada walked away from what he called a "bad deal," Carney said: "We cannot accept what they've offered, and we will not give what they've asked."

New 50% duties impacting around $20 billion worth of Canadian goods took effect on Saturday after the two countries failed to come to an agreement on a trade deal, with both sides accusing each other of trying to implement last-minute changes.

In a statement on Friday, Carney labelled alleged late changes to the terms of the deal proposed by the US "unfair" and "uneconomic" and said they "called into question the reliability of any deal."

He also warned that Ottawa would match US tariffs "dollar for dollar to protect our workers and businesses."

"Our response will be concentrated in sectors such as steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics," Carney said in a speech on Saturday.

The Office of the United States Trade Representative has described it as a "missed opportunity" for Canada, which it said was maintaining a "prolonged retaliation" against the US.

"Despite the U.S. offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk backs of other commitments by Canada have upended the careful balance reached in the past days," it added in a statement posted on social media.

The breakdown in talks came despite optimism from US President Donald Trump that a deal could be reached. Trump had postponed the initial planned start date of the tariffs from Wednesday as an agreement appeared near.

Trump, who has repeatedly suggested that Canada should become the US' "51st state," said early on Sunday that Ottawa wanted "the benefits of being a State, without being one."

"They have also charged our great farmers, for many years, massive amounts of Tariffs. No more!!!," he added.

Trump has pursued an aggressive tariff policy since his return to the White House in January 2025, ramping up levies on partners across the world. The administration argues that tariffs will boost US manufacturing and encourage domestic job growth while addressing what it sees as unfair trade rates.

Critics, however, say increasing duties are making life more expensive for American consumers and businesses while fostering widespread uncertainty among companies planning investments and supply chains.