Trump administration predicts ‘devastating’ impact on Canada in a trade war

The Trump administration warned on Sunday that Canada would be "foolish" to think it can win a trade war with the United States, and predicted a "devastating" impact for its northern neighbor.

The negotiations between Washington and Ottawa broke down late Friday, triggering the implementation of new 50% U.S. tariffs on Canadian products valued at about $20 billion, 5.5% of Canada's total exports to its neighbor.

In retaliation, Ottawa announced that it would match those tariffs with new duties targeting primarily the U.S. steel and dairy industries, which will take effect on September 8.

U.S. Secretary of Transportation Sean Duffy stated that Canada would lose out if it opted for a trade war.

"We're major trading partners, right? But Canada benefits much more from trade with the United States than the United States benefits from trade with Canada," he said on the Fox News Sunday program. "To think that they're going to go to war with Donald Trump and that they're actually going to win that war with the United States seems foolish on their part."

Duffy predicted that Canadian Prime Minister Mark Carney will return to the negotiating table "very, very soon, because it's going to be devastating for his country."

Carney struck a defiant tone on Saturday when he announced retaliatory tariffs against the United States, after walking away from what he considered a "bad trade deal" at a time when the rift between these historic allies was deepening.

"You're at war when you're attacked. We were attacked," he said.

"They have been imposing huge tariffs on our magnificent farmers for many years"

Trump also responded early Sunday on his social media platform, Truth Social. "Canada wants the benefits of being a [U.S.] state, without actually being one!!!" he wrote.

"They've also been charging our great farmers huge tariffs for many years. That's over!!!" he added.