SerpApi.Org
OTTAWA—Canadian Prime Minister Mark Carney said he and President Trump agreed Tuesday to accelerate trade talks in an effort to resolve friction and avoid a new 50% U.S. tariff on a series of goods.
The 50% tariff kicks in as of Aug. 19, after Trump signed a series of proclamations that target Canada for alleged discriminatory treatment of U.S. automobiles, alcohol and dairy products. The hefty duty would affect $20 billion of U.S.-bound Canadian exports, or 5% of total shipments to America. Economists and trade analysts say what’s more important is the message: That Trump is prepared to use its economic heft to force policy changes on the Canadian side.
Carney told reporters in brief remarks that he is scheduled to speak later Tuesday to the country’s provincial premiers, via videoconference, to decide on next steps and whether a policy response is required should the White House make good on its tariff threat. “We will do whatever it takes and keep all options,” he said.
In the Oval Office, Trump said Canada has been tough to deal with over many years, “and no other president has done anything … In all fairness to [Canada], they need us to survive. Without us, there’s no way they can survive.”
Some provincial premiers say Canada should hold the line in talks with Washington, and retaliate if needed.
“We can’t keep rolling over for Donald Trump,” said Doug Ford, the leader of the country’s most populous province, Ontario. “If these talks fail, we need to hit him back as hard as we can … We need to be on the offense, and not constantly on defense.”
Trade talks between the U.S. and Mexico are at an advanced stage, with negotiations picking up this week. Conversely, U.S. officials say discussions with Canada are essentially stalled. The U.S. this month opted against renewing the current North American trade treaty, known as USMCA, for a period of 16 years, thereby subjecting the pact to annual reviews for a decade. A failure to resolve U.S. concerns would lead to the treaty’s termination.
The Canadian economy has struggled under the weight of sector-specific tariffs of up to 50%, targeting automobiles, steel, aluminum and forest products. The bulk of Canadian exports to the U.S. have avoided tariffs because they complied with the existing U.S.-Mexico-Canada trade pact. The new 50% levy, set for implementation next month, marks a break from this exemption status.
Carney said Ottawa is looking for a comprehensive deal with the U.S., arguing it won’t make any concessions until the U.S. agrees to ease existing tariffs. “We don’t want a partial agreement. We want something that addresses those sectors as well,” he said, in reference to motor vehicles, metals and forest products.
One of the reasons the U.S. is threatening a new hefty levy is a ban on the sale of U.S. spirits and wines by most Canadian provinces, in response to U.S. sector-specific tariffs and Trump’s musings regarding annexing Canada as the 51st state.
Carney said it is up to the provinces to decide whether to reverse course. A decision, he added, “should only be taken, in my judgment, as part of an overall agreement.”
Polling published Tuesday by Ottawa-based Abacus Data indicate that over two-thirds of Canadians want federal officials to take a hard line against the U.S., “even if it means living with [trade] uncertainty for longer.” Elevated levels of economic uncertainty have prompted firms and households to either curtail or suspend spending decisions.
Write to Paul Vieira at [email protected]