The trade war between the US and Canada has deepened. US President Donald Trump has announced to increase customs duty from 25% to 50% on steel and aluminum products imported from Canada.
In response to this decision, Canada also reversed and canceled the purchase deal of Novawaax Kovid vaccine. Trump said that this new tariff would come into effect from Wednesday and the decision has been taken in response to a 25% increase in power prices sold by the Ontario province of Canada to the US.
Will this new trade war be heavy on the economy of both countries? Let’s know in detail.
Byd Atto 3 My2025 with great performance and new technology in India
America’s new tariff and Trump’s statement
Now 50% tariff on steel and aluminum:
The Trump administration has ordered a customs duty of up to 50% on steel and aluminum products coming from Canada.
Trump’s claim:
Trump posted on his social media platform ‘Truth Social’ and said,
“I have instructed my Commerce Minister to impose an additional 25% fee on all steel and aluminum products coming from Canada to America. Canada is one of the countries that charge the most fees in the world. ”
Impact on the stock market:
The US stock market saw a decline soon after this announcement.
Background: Canada recently imposed a 25% fee on electricity supplied to the US, in response to which the Trump administration took this step.
Canada’s reply: Novawaax deal canceled
Canada also retaliated on this decision of America and canceled the purchase deal of Novawaax Covid vaccine.
What is this deal?
- In 2021, Canada signed an agreement to buy millions of doses of Kovid-19 vaccine from the American Biotech company Novawaax.
- The vaccine was to be built at Montreal’s Biologics Manufacturing Center.
Why the agreement was canceled?
- Novawaax could not get regulatory approval until the end of 2024.
- The Canadian government immediately canceled the deal in response to the US’s new tariff.
Importance:
Novawaax was about to get a chance to become the first company to start the Kovid-19 vaccine production in Canada, but now the plan has come to a standstill.
Trump’s tariff war effect
Tariff war started again in 2024:
Trump has talked about increasing customs duty since becoming President for the second time.
Which countries can be imposed on extra tariffs?
- It is being planned to impose retaliation on several countries including Canada, China, Mexico, India.
Effect on US economy:
- The risk of increasing input costs on American companies.
- There is a possibility of a big fall in the stock market.
- Global Supply Chain may be interrupted.
Impact on economy around the world:
Experts believe that if this trade war increases, the possibility of global recession may be intensified.
Will this tariff war progress further?
Possible effects:
If business tension in Canada and America increases further, Canada can also impose new taxes on American products.
America’s Strategy:
The Trump administration believes that this policy will force American companies to transfer their factories to the US, which will benefit the American economy.
Canada’s possible response:
Canadian Prime Minister Justin Trudeau has already said that he will respond to any unfair business decision of America.
