Canadian Prime Minister Mark Carney declared on Monday that Canada and the United States are effectively 'at war' on trade, announcing that Canada would impose retaliatory tariffs against American goods following the breakdown of bilateral trade talks. The announcement signals a sharp escalation in the ongoing dispute between the two countries over tariff policy initiated by the Trump administration.

A Canadian government official confirmed to the Associated Press that Canada would formally announce its retaliatory measures on Tuesday. The move comes after negotiations between the two governments failed to produce an agreement, with Carney publicly rejecting the terms on offer from Washington.

Carney, who has staked much of his political identity on standing firm against U.S. economic pressure, has maintained significant domestic support for his defiant posture toward the Trump administration. Polls have shown Canadians broadly backing the retaliatory approach, viewing economic sovereignty as a matter of national pride amid what many characterize as aggressive American trade tactics.

The trade dispute has also introduced complications around language and cultural policy, with reports indicating that disagreements over French-language protections and cultural exemptions played a role in the breakdown of talks. Canada has long maintained carve-outs in trade agreements to protect its French-language broadcasting and cultural industries.

The declaration of a trade 'war' between the U.S. and Canada — two of the world's largest trading partners and longtime allies — represents a historic low point in the bilateral relationship. Analysts warn that retaliatory tariffs from both sides could disrupt deeply integrated supply chains spanning the shared border, affecting industries from automotive manufacturing to agriculture.