Trump pauses planned 50% tariffs on Canada for three days as US and Ottawa race to finalize trade deal

By: Ebenezer Adugyamfi/ Emmanuel Ayiku for GhanaianNewsCanada
August 19, 2026

U.S. President Donald Trump has temporarily paused plans to impose a new 50% tariff on certain Canadian imports, giving the United States and Canada three additional days to finalize a trade agreement.

The tariffs had been scheduled to take effect early Wednesday, August 19, but Trump announced the last-minute suspension on Tuesday, saying the two countries had reached a deal that was still subject to the completion of formal documents.

“I have paused the 50% Tariffs against Canada… for a three day period,” Trump said, citing what he described as a deal between Washington and Ottawa.

The proposed tariffs were expected to affect approximately $20 billion worth of Canadian goods, adding another layer of uncertainty to an already strained trading relationship between the two North American neighbours.

Carney confirms progress but warns work remains

Canadian Prime Minister Mark Carney acknowledged that significant progress had been made during negotiations with the Trump administration.

However, Carney stopped short of declaring the trade dispute fully resolved, stressing that important issues still needed to be addressed before a final agreement could be completed.

The three-day pause therefore provides both governments with a narrow window to finalize the outstanding details and prevent the proposed tariffs from taking effect.

Under the latest timeline, the duties are expected to come into force on August 22 if no final agreement is reached.

Trade tensions remain

The latest dispute is part of a broader series of trade disagreements between the United States and Canada during Trump’s second presidency.

Washington has raised concerns over Canadian policies affecting American businesses, particularly in areas including dairy, alcohol and motor vehicle trade, while Ottawa has continued to defend its domestic economic policies and interests.

The proposed 50% tariffs have generated concern among Canadian businesses that depend heavily on access to the U.S. market.

Canada and the United States have one of the world’s largest bilateral trading relationships, meaning prolonged tariff disputes could have consequences for businesses, consumers and workers on both sides of the border.

Keystone XL pipeline returns to the conversation

Alongside his announcement on the tariff pause, Trump also suggested that the controversial Keystone XL pipeline project could potentially be revived.

The pipeline project, which was intended to transport Canadian crude oil to the United States, was cancelled during former President Joe Biden’s administration.

Trump did not provide detailed conditions for a possible revival, but his comments have added another significant issue to the ongoing U.S.-Canada economic discussions.

Three days to avoid another escalation

For now, the tariff threat has been put on hold rather than permanently withdrawn.

The next three days could therefore prove crucial as American and Canadian officials work to turn the reported preliminary agreement into a finalized deal.

If negotiations succeed, the pause could mark a significant step toward easing months of trade tensions between Washington and Ottawa.

If the two sides fail to finalize the agreement, however, the proposed 50% tariffs could take effect on August 22, potentially reigniting the latest phase of the U.S.-Canada trade dispute.