Key facts
- Canada and the US are in intense trade negotiations to avoid new tariffs.
- New tariffs on approximately $20 billion of Canadian imports are scheduled to take effect on Wednesday.
- US demands include removing retaliatory tariffs on American autos and adjusting dairy quotas.
- Canada seeks the removal or reduction of US tariffs on its steel, aluminum, auto, and lumber sectors.
- Canadian Prime Minister Mark Carney plans to speak with President Trump before the deadline.
Intense trade negotiations are underway between Canada and the United States, with less than 48 hours remaining before new tariffs on approximately $20 billion worth of Canadian imports are set to take effect. Canadian negotiators have been in Washington for a week attempting to secure an agreement to avert the new financial measures.
Prime Minister Mark Carney described the talks as "very delicate and intense," emphasizing that it is not the appropriate time for public negotiation. While he expressed confidence in Canada's negotiating position, the stakes are high for his team to reach a deal before the US administration's latest financial pressure is applied to about 5% of all Canadian imports.
Despite recent meetings between Canadian negotiators and US Trade Representative Jamieson Greer, a final agreement has not yet been reached. US-Canada Trade Minister Dominic LeBlanc stated on Monday that their work was "not yet done" and warned of the need to "get tougher" if a deal fails. Any concessions made by Canada would need to be accepted by the public and provincial governments.
The US is seeking several concessions from Canada, including the removal of remaining retaliatory tariffs on American autos and adjustments to dairy quotas. Additionally, the US has requested the lifting of the ban on US alcohol sales, which was imposed by most Canadian provinces in response to previous US tariffs. The agreement on alcohol sales is contingent on the approval of the provinces.
Canada, meanwhile, is aiming for a deal that would see the US drop or reduce tariffs on its steel, aluminum, automobile, and lumber sectors, which have negatively impacted the Canadian economy. Ontario Premier Doug Ford indicated that an agreement on alcohol sales would be conditional on progress in these key sectors.
Concerns also exist regarding potential pushback on dairy concessions, particularly in Quebec, where Premier Christine Fréchette has stated that the supply management system is non-negotiable. The US argues that this system is unfair to American farmers.
Public sentiment in Canada indicates frustration with the trade dispute, with a significant majority feeling its impact on their households. A recent poll suggests that 36% of Canadians favor responding with counter-tariffs, even at the risk of further economic pain, while only 18% support making concessions like ending the alcohol sales ban.
Prime Minister Carney has committed to only signing a deal that is beneficial for Canada. He plans to speak with President Trump before the Wednesday deadline and has stated he has contingency plans in place should the talks fail. Conservative trade critic Shuvaloy Majumdar expressed a desire for relief from economic anxiety and hope for a "genuine win" at the negotiating table.