Canada and China Impose Retaliatory Tariffs on the US: The Global Trade War Continues

With trade tensions between the US and its international partners showing no signs of abating, Canada and China have officially announced retaliatory tariffs on US goods. This move not only increases tensions in international trade relations but also poses major challenges to the global economy, which is recovering from the COVID-19 pandemic.

On October 15, 2023, the Canadian Government officially announced the imposition of retaliatory tariffs on a number of imported goods from the US. Accordingly, an additional tax rate of up to 35% will be applied to products such as steel, aluminum, wine, pork, and a number of other agricultural products. These measures will take effect from January 1, 2024 and will be maintained for 5 years.

Canada’s Trade Minister Mary Ng stressed that the decision was necessary to protect the interests of Canadians and businesses against “unfair” trade policies from the US. “Canada has always supported free and fair trade. However, we are forced to act to ensure that Canadian industries and workers are not harmed by unilateral decisions from the US,” Ng said.

Not only Canada, China has also announced similar retaliatory measures. According to the announcement from the Chinese Ministry of Commerce, the country will impose additional tariffs ranging from 10% to 25% on a range of imported goods from the US, including automobiles, chemicals, agricultural products, and high-tech products. These measures are said to be in response to the US’s continued high tariffs on Chinese goods, especially in the technology and manufacturing sectors.

A representative of the Chinese Ministry of Commerce affirmed: “We always want to resolve trade disputes through peaceful negotiations. However, if the US continues to adopt tough trade measures, we will have to take corresponding responses to protect our national interests.”

Up to now, the Joe Biden administration has not officially responded to the moves of Canada and China. However, analysts believe that the US will likely continue to maintain a tough stance in its trade policies. Some experts even predict that the US may impose additional economic sanctions against both Canada and China.

In a recent statement, a representative of the Office of the United States Trade Representative (USTR) said: “The US will continue to protect the interests of American businesses and workers from unfair trade practices from other countries.”

Trade tensions between major economies such as the US, Canada, and China are expected to have many negative consequences for the global economy. Commodity prices may increase due to increased production and transportation costs, while global supply chains continue to be disrupted. This is especially dangerous in the context of the world still recovering from the severe impacts of the COVID-19 pandemic.

Import-export businesses around the world will face many challenges, from increasing raw material costs to finding alternative markets. Consumers will also be affected by rising commodity prices, especially essential items such as food and daily necessities.

Although trade tensions between countries are at a high level, there are still positive signs that the parties may return to the negotiating table. Both Canada and China have stressed that they are willing to negotiate to resolve their differences peacefully. However, this requires goodwill from both sides, especially the United States.

Economists say that to thoroughly resolve trade conflicts, countries need to make certain concessions and seek mutually beneficial solutions. Otherwise, the global trade war could drag on and cause more serious consequences for the world economy.

The fact that Canada and China imposed retaliatory tariffs on the United States shows that global trade tensions have not shown any signs of cooling down. In this context, countries need to seek negotiated solutions to avoid more serious consequences for the world economy. Hopefully, with the efforts of all parties, a peaceful and fair solution will soon be found.