Just last week US President Donald Trump expressed skepticism over finalizing a trade agreement with Canada. He added that the U.S. has consistently lost ground in negotiations with its north of border, our second-largest trading partner. Speaking to reporters on Air Force One, Trump suggested that Canada should be treated as a country where tariffs are allowed to win out over talks. He characterized the tenor of talks so far as “productive” and “cordial,” though he’s still skeptical about the final result.
Trump has insisted on an August 1 deadline for the negotiations. This action further signals his intention to renegotiate trade agreements between US and other key partners. He has delivered hurtful retaliatory tariffs on Canadian products. This includes a 25% tariff on many foreign imports and a damaging 50% tariff on aluminum and steel. He even threatened a 25% tariff on all cars and trucks that weren’t made in America. He threatened that US importers would be subjected to a 35% tariff if an agreement is not made by the deadline.
In his remarks, Trump noted, “We haven’t really had a lot of luck with Canada.” That last sentiment is indicative of his continued anger over the negotiating stages. His administration wants you to think that by imposing these tariffs, they’re promoting American manufacturing and protecting American jobs.
Canadian Prime Minister Mark Carney has been firm in his stance, emphasizing that Canada “will not accept a bad deal” and is committed to taking “the time necessary to get the best deal.” This clause further signals Canada’s determination to not settle for a hasty agreement that is likely to hurt its economic interests.
In a statement, Intergovernmental Affairs Minister Dominic LeBlanc made similar comments, agreeing that there is certainly “a lot of work” to do on both sides of the border. She characterized those negotiations as “productive…and cordial.” That’s a positive sign that both sides are committed to continuing the discussion, despite their sizeable hurdles.
The trade agreements Trump has already negotiated with other countries, like Japan, serve as a backdrop to these negotiations. His deal with Japan includes a lower starting tariff rate of 15%. In exchange, Japan will pour a huge $550 billion into the US economy. This latest move continues to underscore Trump’s big-picture, long-term plan to use trade agreements to make America more competitive.
With just a few weeks to go before the August deadline, both sides continue to battle it out at the bargaining table. What happens next for their bilateral trade relationship remains to be seen. Trump himself has expressed skepticism that he will be able to reach a good deal.