Canada will soon be removing tariffs on goods from the United States that are covered under the Canada-U.S.-Mexico Agreement (CUSMA).
Prime Minister Mark Carney made the announcement during a news conference on Friday, one day after talking with U.S. President Donald Trump.
Carney said the move will take effect by September 1.
He called it a positive development, following in the footsteps of the U.S., which recently exempted those goods.
"The situation we're in now is that Canada and the United States have reestablished free trade for the vast majority of our goods," said Carney. "Canada will retain our tariffs on steel, aluminum, and autos as we work intensively with the United States to resolve the issues there."
Carney said Canada is getting a better deal with the U.S. than any other country.
"The actual U.S. tariff rate on Canadian goods is 5.6 per cent," he said. "Compare that to the 16 per cent global average. That remains the lowest amongst all United States trading partners."
Carney added that more than 85 per cent of Canada-U.S. trade is now tariff-free.
"Following my conversation with (Donald Trump) on Thursday, Canada and the United States will intensify our discussions to address current trade challenges in those strategic sectors, and to seize major immediate opportunities for us both in trade, investment, and security," he said.
Carney said Canada will continue to take measures to support local businesses and consumers.
"To address challenges in strategic sectors from agriculture to autos, the Canadian government will soon announce a new, comprehensive industrial strategy," said Carney. "It will protect Canadian jobs, boost Canadian competitiveness, buy Canadian goods, and diversify Canadian exports."
On July 31, U.S. President Donald Trump announced that tariffs on goods not covered under CUSMA would be hiked from 25 per cent to 35 per cent.
Trump pinned the blame on illicit drugs and fentanyl entering the U.S. from Canada.
