America has implemented an import ban on $1 billion U.S. worth of Canadian goods, including alcohol and dairy products.
The ban, which also includes Canadian-made motorcycles, is the latest escalation by U.S. President Donald Trump in his trade war with America’s northern neighbour.
However, economists point out that the new import ban is largely symbolic as it represents a tiny amount of the nearly $900 billion U.S. worth of two-way trade between the countries.
Still, the escalation, while small, indicates that the trade war between the U.S. and Canada is unlikely to end anytime soon.
In recent months, the Trump administration has imposed 50% tariffs on about $20 billion U.S. worth of Canadian imports.
Canada’s federal government in Ottawa has responded with counter tariffs of 15% to as much as 50% on a range of U.S. imports.
To punish Canada for retaliating against his tariffs, Trump decided to ban Canadian alcohol, dairy, and other products on Sept. 29.
The majority of the new ban covers Canadian alcoholic beverages, which is in response to several provinces in Canada banning U.S. booze.
While the economic impact of the banned imports is expected to be minimal, it’s likely to make it difficult to renew the Canada-United States-Mexico Agreement on trade, say analysts.
Canadian Prime Minister Mark Carney is seeking to reduce Canada’s reliance on the U.S., which last year accounted for about 70% of Canadian exports.
