The U.S. tariff on Canadian goods will increase to 35 per cent as of Friday.
President Donald Trump signed an executive order Thursday evening to increase the tariff from its current 25 per cent.
The White House said Canada has failed to curb the “ongoing flood of fentanyl and other illicit drugs” across the border and has retaliated against the U.S. for the president’s action.
Officials said the increased tariff will only apply to goods that do not comply with the Canada-U.S.-Mexico Agreement.
Canadian officials have spent the past several weeks trying to reach a new trade deal with the U.S. ahead of Friday’s deadline.
Prime Minister Mark Carney told reporters Wednesday that they are seeking the best deal possible for Canadians.
“These are complex, they are comprehensive, they’re constructive negotiations with the Americans,” he said.
“It is possible that they may not conclude by the 1st of August.”
Carney said it is likely that a deal with the United States will still include some sector-specific tariffs.
“The president has been very clear, and all the actions bear this out, and that there are certain sectors that are strategic, in their judgement, to the United States economy,” he said.
“The revealed approach of the United States in all those sectors has been to have tariffs, some base level of tariffs, and that’s consistent, with very few relatively minor exceptions.”
Some of the sectors referenced by Carney include aluminum, steel, automobiles and softwood lumber.
Meanwhile, a 50 per cent tariff on some copper products being imported into the United States is set to take effect on Friday.
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