Canadian Prime Minister Mark Carney ended trade negotiations with the United States on Friday night, less than an hour before a deadline for new tariffs to take effect, according to the report published August 22, 2026. Carney said Canada would impose equivalent, dollar-for-dollar tariffs on US goods if Washington levies 50 percent duties on C$2 billion worth of Canadian products. He said he sought the best possible agreement for Canada but would not accept a deal at any price or within any deadline.

The talks collapsed after both sides accused the other of introducing new and unreasonable conditions at the last moment. US President Donald Trump had said on Tuesday that an agreement was nearly complete, while Carney repeatedly maintained that significant work remained. The report says Canada’s economy is deeply connected to the United States and that Ottawa relies heavily on its neighbour in defence, making Carney’s decision risky. He said the government would support Canadian industries and businesses harmed by the tariffs.

Provincial leaders from differing political camps backed Carney, including Ontario Premier Doug Ford and British Columbia Premier David Eby. Alberta Premier Danielle Smith urged a return to negotiations. Carney has sought to reduce Canada’s economic dependence on the United States by building partnerships in Asia and Europe, though the report says it remains uncertain whether those markets can quickly offset disruption in US-Canada trade.