President Trump said he would prohibit Canadian firms from receiving government contracts in the U.S.-a retaliation for Canadian tariffs that took effect earlier in the day as part of the nations' monthslong trade conflict.
Trump posted on Truth Social Tuesday that he would direct the General Services Administration and U.S. Trade Representative's office to remove Canadian firms from the agency's so-called "Multiple Award Schedules," which connect federal, state and local government agencies with suppliers of a wide variety of products.
"I am hereby directing the GSA, working with the USTR, to take all necessary steps to REMOVE Canadian-origin products from GSA's Multiple Award Schedules unless Canada restores full and fair reciprocity for American Farmers and Companies," Trump posted, arguing that the Canadian government blocks U.S. firms from receiving similar contracts.
Canada last year instituted a "Buy Canadian" policy to push government agencies to prioritize Canadian goods in their purchases after tariffs and threats of annexation from Trump. The president, however, didn't specifically name the policy he was targeting in his Truth Social post.
The move comes as retaliation for Canada imposing tariffs ranging from 15% to 50% on about $20 billion of U.S. goods on Tuesday morning-amounting to about 6% of U.S. exports to its northern neighbor. Those tariffs covered a variety of products from electronics and appliances to dairy products, and were themselves a response for Trump's latest round of levies, imposed in late August on $20 billion worth of Canadian goods, or about 5% of its exports to the U.S.
The scale of the action on Canadian businesses was not immediately clear on Tuesday, but Trump posted that the GSA's contracting schedule accounts for more than "50 BILLION DOLLARS a year." Trump didn't provide details on when the prohibition would take effect, and the White House has so far posted no official proclamations or actions to implement it.
The levies and contracting prohibition represent the latest flare-up in a trade war between the North American neighbors that has spanned Trump's second term in office. In August, the two nations looked close to a deal that would avert the latest wave of tariffs, but negotiations broke down in the final hours before a U.S.-imposed deadline, with each government blaming the other for walking away from the table.
Trump's action on Tuesday stops short of hiking more levies on Canada, which could have invited a further tariff retaliation that would have hit industries in border states like Michigan, New Hampshire and Maine, which have competitive midterm elections.
Instead, Trump has put off his next round of tariff retaliation until Jan. 1, when he has threatened to increase tariffs on Canadian metals and vehicles, giving the nations time to come back to the negotiating table.
Comments