US-Canada trade talks collapse, raising fears of escalating tariffs

Canada rejected what Washington stated were the final terms to prevent new tariffs. The breakdown occurred after days of talks, with Canada now threatening retaliatory measures against any new American tariffs. US Trade Representative Jamieson Greer accused Canada of abandoning the process and introducing new demands, while Canada's Prime Minister, Mark Carney, stated that the last-minute conditions from Washington were unacceptable.

The dispute centers on the scale and scope of proposed American tariffs on sectors including automobiles, steel, aluminum, and lumber. The collapse threatens to deepen an already damaging economic confrontation between the countries, whose economies are closely linked. Canadian retaliation could lead to further actions from President Donald Trump, with a US official indicating Washington is prepared to respond to counter-tariffs.

Both governments face an immediate economic and diplomatic challenge, with the failure of talks removing a potential path to de-escalation.