Tensions between Washington and Ottawa have deepened as U.S. President Donald Trump announced a 10 percent increase in tariffs on Canadian imports, following a diplomatic spat over a controversial Reagan-themed advertisement aired in Ontario.

The ad, which invoked former U.S. President Ronald Reagan’s criticism of tariffs, was seen by the Trump administration as a direct challenge to its trade policies.

The announcement came during Trump’s visit to Malaysia on Saturday, where he condemned the advert as a “fraud” and faulted Canadian authorities for allowing it to air during the World Series baseball championship.

The Ontario government sponsored the campaign to promote free trade, using Reagan’s 1987 radio remarks that warned tariffs “hurt every American.”

In response, Ontario Premier Doug Ford announced that he would temporarily suspend the ad campaign to facilitate fresh trade negotiations with Washington, following discussions with Canadian Prime Minister Mark Carney.

However, Ford noted that the advert would still run in U.S. markets over the weekend, including during the World Series broadcasts between the Toronto Blue Jays and the Los Angeles Dodgers.

Trump, angered by the move, took to social media to accuse Canadian officials of “political grandstanding” and insisted the advert should have been withdrawn immediately.

The U.S. already levies a 35 percent tariff on Canadian goods, with additional duties of 50 percent on metals and 25 percent on automobiles. The new 10 percent hike, Trump said, would apply “over and above what they are paying now.”

Reacting to the development, Canada’s Trade Minister Dominic LeBlanc reaffirmed Ottawa’s commitment to dialogue, emphasizing that “progress is best achieved through direct engagement with the U.S. administration.”

Economists warn that Ontario, Canada’s industrial hub and home to much of its auto manufacturing, could face the harshest impact, given that about three-quarters of Canada’s exports are destined for the United States.