Industry advocates react as Carney suspends trade talks, plans retaliatory tariffs
Prime Minister Mark Carney’s decision to suspend trade negotiations with the United States and announce dollar-for-dollar retaliatory tariffs on September 8 has sparked reaction from industry lobby and advocacy groups.
The Trump administration has imposed sweeping 50 per cent tariffs against Canadian exports to the United States of industrial and construction materials, consumer goods, agricultural products, and recreational and everyday goods, effective August 22.
This latest round of tariffs will hit small businesses the hardest, said the Canadian Federation of Independent Business (CFIB).
While the advocacy group said it does not intend to question the Carney government’s decision to halt negotiations, CFIB president Dan Kelly is counting on Ottawa to resume negotiations “as soon as possible” to minimize the impact of the tariffs on Canadian business owners.
Kelly said in a news release that the impact will be “immediate and significant.”
“While 20 percent of small businesses export, more than 50 percent import from the United States,” he said. “The burden of retaliatory tariffs ultimately affects consumers, but the first to be affected are the small businesses that matter.”
Forty percent of small exporters will be affected by the tariffs and nearly a third expect their income to fall by 50 percent or more as a result, the advocacy group said.
Small businesses at the center of the tariff focus will be those selling machinery and equipment, lumber and construction products, plastics and packaging, food and beverages, and art, jewelry and creative products.
While Carney promised a $25 billion aid package for small and medium-sized businesses hurt by these tariffs, Kelly hopes the results work out better than the “shockingly unfair and ineffective” federal programming of the pandemic days, which he said discouraged small businesses from applying.
“No deal is better than a bad deal,” responded the Canadian Steel Producers Association (CSPA), in response to this “worrying escalation” by the White House.
The current situation continues the “uncertainty and various challenges” facing domestic steel producers, the industry lobby group said, calling the breakdown of talks “regrettable”.
CSPA expressed confidence in Canada’s negotiating team to reach a deal and said it will continue its own talks with Ottawa to “counter unfair trade practices and provide Canadian steel producers with as level a playing field as possible.”
The Canadian Manufacturers and Exporters (CME) said the inability to reach an agreement between Canada and the United States only “exacerbates the challenges” facing producers of steel, aluminum, automobiles and auto parts.
The uncertainty will delay investments in new facilities, machinery, equipment, technology and workforce development, the CME said in a statement.
The group urges Ottawa to act quickly to provide “targeted support” to the most affected manufacturers and recommends the remission of any retaliatory tariffs on “essential manufacturing inputs that cannot be competitively sourced in Canada.”
Meanwhile, “negotiations must continue” since both countries have a “powerful economic interest in reaching a comprehensive agreement” that creates a “stable and predictable North American trade relationship.”
The collapse of trade negotiations is “devastating” for the hardest-hit forestry sector, said Forest Products Association of Canada president and CEO Derek Nighbor. CTV News.
Nighbor said its members could be the most negatively affected Canadian sector given the scope and cumulative effects of the US tariffs. The sector has endured combined tariffs and tariffs of 45 percent imposed by the Trump administration since October 2025.
Beyond lumber, in this round the White House will impose 50 percent tariffs on value-added products, including kitchen cabinets, upholstered wood furniture, particle board, roofing and flooring products, an amount of cross-border trade cumulatively valued at $10 billion a year.
Nighbor said immediate attention should focus on government measures that protect and sustain businesses and jobs to help the industry “weather the storm” until negotiators reach a trade deal.
A quick fix to improve domestic competitiveness, he said, is for Ottawa to finally address a chronic industry frustration when it comes to granting excessive permits and imposing additional regulations by the environment and fisheries departments. When it comes to federal procurement, Nighbor said, the Canadian timber industry wants to be a “big part” of the $4 billion program aimed at new military housing.