Kathmandu— The United States has imposed 50 percent tariffs on approximately $20 billion worth of Canadian goods following the breakdown of three days of trade talks in Washington, D.C., which concluded without an agreement late Friday night. The tariffs, which took effect at 12:01am Eastern Time (04:01 GMT) Saturday, will impact roughly five percent of Canadian exports to the US, including electronics, industrial machinery and dairy products, escalating a trade dispute between the two nations that began last year. Canada’s Prime Minister Mark Carney responded by promising equivalent retaliatory tariffs, while the US Trade Representative blamed Canada for failing to finalize an agreement despite what they characterized as favorable terms.

Failed Negotiations and Tariff Implementation

Negotiations between US and Canadian officials stalled, preventing a final trade deal from being reached before President Donald Trump’s deadline. The tariffs were announced in July after the president accused Canada of “discriminatory treatment of American products.” Despite expressing optimism for a potential agreement on Friday, Trump's expectations ultimately went unmet. The new tariffs build upon existing US levies on Canadian steel, lumber, and automobiles.

Canadian Response and Support Measures

Prime Minister Mark Carney stated that Canada would respond with matching “dollar for dollar” retaliatory tariffs. He acknowledged progress had been made in improving Canada’s trade position but noted it was insufficient to meet Canadian objectives. Carney also indicated his government would introduce measures in the coming days aimed at supporting workers and businesses affected by the escalating trade war.

US Accusations and Missed Opportunity

US Trade Representative Jamieson Greer placed responsibility for the failed negotiations on Canada, describing it as “a missed opportunity to partner with the United States.” Greer claimed that Canada declined to finalize a deal based on previously agreed terms. He further stated that new demands from Canada and reversals of prior commitments had disrupted the balance achieved during recent discussions.

Potential Economic Impact

Experts predict the 50 percent tariffs could significantly harm Canadian businesses exporting goods to the US, potentially pricing them out of the American market. Julian Karaguesian, a trade expert at McGill University in Montreal, previously warned that such tariffs would “effectively price hundreds of Canadian goods out of the US market.” The dispute follows a pattern of back-and-forth tariff exchanges between the two countries since Trump imposed initial levies last year.

The implementation of these tariffs marks a significant escalation in trade tensions between the United States and Canada, with both nations prepared to impose retaliatory measures. Further developments are expected as each country assesses the impact on its economy.

(With inputs from Al Jazeera)

Originally published on abcnews.com.np.