US President Donald Trump has suspended plans to double tariffs on Canadian steel and metal imports to 50%. However, the 25% tariff is still set to be implemented starting March 12.

This decision came after Ontario, Canada, halted a 25% new charge on electricity exported to several northern US states.

Analysts warn that this move could escalate into a trade war, posing economic risks for both North American neighbors.

Trump's trade advisor, Peter Navarro, confirmed that Trump would not proceed with his latest tariff threats. Canada, one of the US's closest trade partners, has faced Trump's ire since he initiated trade conflicts early in his presidency.

Trump imposed a blanket 25% tariff on goods from Canada and Mexico, though he temporarily exempted certain items, citing concerns over drugs and immigration into the US. Canada is also facing a 25% tariff on its steel and aluminum exports, effective Wednesday, as Trump ends previous tariff exemptions for some countries.

Canada has called Trump's actions unreasonable and announced retaliatory measures, including new tariffs on $30 billion CAD ($22 billion USD) worth of US goods.

Ontario Premier Doug Ford announced plans to tax electricity exports to the US in response to the tariffs. He also warned of potentially halting electricity exports entirely if tensions escalate.

Ford described the suspension of electricity tariffs as a "right decision" to refocus discussions on broader North American free trade agreements. He thanked Trade Minister Howard Lutnick for facilitating talks and emphasized the need for both sides to lower tensions and move forward.

In a social media post, Trump justified his actions as a response to Ford's measures and criticized Canada for relying on the US for "military security." He reiterated his desire to make Canada the 51st US state, claiming that all tariffs would be removed if this happened.

The White House stated that Trump's use of economic leverage was a victory for the American people, highlighting the importance of tariffs as taxes on imported goods. Companies importing foreign products into the US are required to pay these taxes to the government.