Canadian Prime Minister Mark Carney has said he is “disappointed” by an increased tariff on some exports to the United States.

Donald Trump escalated a trade war by boosting the tariff rate from 25% to 35%, saying that Canada had “failed to cooperate” in curbing the flow of fentanyl and other drugs across the US border. The Canadian government says it is cracking down on drug gangs.

However most goods from Canada will dodge the import tax imposed by the US thanks to an existing trade treaty, the United States-Mexico-Canada Agreement (USMCA).

Economists and financial analysts have warned that the new levies will raise prices for businesses and consumers in the US and weigh on the economy, predictions that the Trump administration has dismissed.