The US-Canada trade war continues to escalate after Mr. Trump threatened to increase tariffs to 50% on steel and aluminum, in retaliation for the Ontario Premier's announcement to cut off electricity exports to the US.
Mr. Doug Ford, Premier of the Canadian province of Ontario, attends an event in Ontario on March 3 - Photo: REUTERS
On March 11, Ontario Premier Doug Ford repeated his warning that he would cut off electricity exports to the United States after Mr. Trump announced doubling tariffs on Canadian steel and aluminum to 50%.
Tit for tat
The statement was made by Mr. Ford after US President Donald Trump announced plans to double tariffs on Canadian steel and aluminum from 25% to 50% on the social network Truth Social on the morning of March 11 (US time).
Not only that, Mr. Trump also continued to threaten to annex Canada in retaliation for the province of Ontario imposing a 25% surcharge on electricity exported to three US states including Michigan, New York and Minnesota.
However, by the afternoon of March 11, the two sides began to make peace. Mr. Ford said he had reached an agreement with US Secretary of Commerce Howard Lutnick.
Accordingly, he will suspend the plan to impose a 25% surcharge on electricity exported to the US and fly to Washington this week to negotiate with the Trump administration.
On the Washington side, after the meeting between Mr. Ford and Mr. Lutnick, White House trade adviser Peter Navarro confirmed to CNBC that Mr. Trump would not impose the 50% tariff he had previously threatened.
However, the White House announced that the initial 25% tariff on steel and aluminum imported into the US will take effect from March 12 for all of Washington's global trading partners without any exceptions or exemptions.
In the near future, this tax could continue to spark a trade war between Canada and the US. Previously, the government of the maple leaf country also said it would announce reciprocal tariffs in retaliation for the tax from Washington.
"The Canadian government has been clear on this issue from the beginning. If the US imposes tariffs on Canadian goods, including aluminum and steel, we are ready to respond firmly and proportionately," said Canadian Finance Ministry representative Gabriel Brunet.
The war is not over yet
Steel coils are produced at a factory in Ontario, Canada on February 14 - Photo: REUTERS
Analysts say the trade war between the US and Canada not only affects bilateral relations between the two countries, but also has a significant impact on related entities.
According to senior economist Ryan Young from the Competitive Enterprise Institute (USA), imposing tariffs on goods from other countries almost always leads to retaliation, higher consumer costs, as well as concerns about recession.
“Sometimes the only way to win is to not play the game. That’s true of both nuclear war and tariffs,” said Ryan Young.
Not only that, Mr. Trump's threats and a series of erratic statements about tariffs have made many investors and businesses worried.
Trump's sudden escalation of the trade war with Canada has increased selling pressure on Wall Street, causing the S&P 500 index - one of the most important US stock indexes, based on the capitalization of the 500 largest companies on US stock exchanges - to fall nearly 1% in value after fluctuating sharply throughout the day, according to the Washington Post .
Over the weekend, economists at JPMorgan raised their recession forecast to 40% this year, up from 30% by early 2025.
Mr. Eswar Prasad - professor of trade policy at Cornell University - said that Washington's threats against Ottawa will have important impacts not only on the North American economy, but also on the stability of the world order, according to the New York Times .
Take the economy as leverage?
After hours of tension, both sides have shown signs of concessions, at least for now. The Washington Post said it is still unclear what the White House's inconsistent diplomatic moves mean, other than exposing the unpredictability of Mr. Trump's policymaking.
On the afternoon of March 11 (US time), White House spokesman Kush Desai said that President Trump's threats had succeeded in forcing Canada to "back down"."President Trump is once again leveraging the American economy, the best and largest economy in the world, to deliver victory for the American people," Mr. Desai emphasized.
Source: https://tuoitre.vn/thuong-chien-kich-tinh-my-canada-ong-trump-va-thu-hien-ontario-an-mieng-tra-mieng-20250312141831766.htm
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