OTTAWA — It was going down to the wire. Again.
As the hours ticked by before punishing new U.S. tariffs were set to take effect at midnight, U.S. President Donald Trump signalled Friday that a deal was within reach while Prime Minister Mark Carney remained out of public view and his office was silent on the fate of talks in Washington.
Trump, when asked if he’d concluded a deal that just two days earlier he had boasted was done, told reporters, “I think so, yeah, we’ll see.”
Speaking before boarding his plane en route to South Carolina, Trump said “the deal with Canada is moving along.”
“We should be able to have a deal with Canada,” said Trump, adding “we’re also starting on a new deal with Mexico, a much better deal for the United States.”
“I only make good deals,” he added. “Much better deal for the United States, both with Canada and Mexico.”
The U.S. has already been in formal negotiations with Mexico to rewrite continental trade rules but Trump has refused to formally engage in renewal talks with Canada on the Canada-U.S.-Mexico Agreement (CUSMA). Instead, Trump imposed wave after wave of tariffs on this country.
Carney was huddled at in his Ottawa home Friday, receiving updates while political rivals and others warned against accepting damaging sector-wide tariffs and granting other concessions.
In Washington, Canada-U.S. Trade Minister Dominic LeBlanc left Friday’s trade talks shorty after 7 p.m., giving no indication whether a deal would be struck to avert the latest tariff threat or to secure another extension. Janice Charette, Canada’s chief trade negotiator, was still in U.S. trade representatives headquarters after 9 p.m.
“We have more work to do,” LeBlanc said. “We’re going to continue working up until the last minute. Our job is not finished. Canadian workers, Canadian businesses expect us to do all of this important work.” He did not take questions.
Canada entered these latest negotiations looking to stave off 50 per cent tariffs Trump threatened to impose on $28 billion worth of Canadian goods, and to secure relief on existing U.S. tariffs on steel, aluminum, autos and lumber. Its other major goal: get the Trump administration to engage in talks on CUSMA, which Trump declared in July he would not renew, ushering in a deep wave of uncertainty for the Canadian economy and businesses reliant on Canada-U.S. trade.
The U.S. entered the talks with the aim of forcing Canada to open market access for dairy under its supply management system, drop its counter-tariffs on autos and lift the provincial bans on American liquor and wine.
At the same time, Trump’s previous tariffs on Canadian autos, steel, aluminum, lumber and other products remain in place. Carney has demanded those be lifted, calling them an illegal and unjustified violation of CUSMA, which Trump signed in 2018 and took effect in 2020.
But Carney’s team appeared this week resigned to achieving only lower sectoral tariffs on steel, aluminum and autos, not their elimination — all in the interest of getting Trump to suspend additional tariffs and drawing him into the broader CUSMA renegotiation.
A top member of LeBlanc’s staff wrote to the Canada-U.S. advisory committee of outside experts, urging them to remain disciplined and united as the “complex and consequential” trade talks unfolded, and admitting the pressure was immense.
“This is an intense moment. The stakes are significant and media attention is intensifying,” Brandan Rowe wrote in the email obtained by the Star. “That pressure is being felt by Canadians across the country, and those at the table are acutely aware of it.”
Rowe underscored that “critical work remains ahead of us. Our strength in the hours to come will rest on discipline, focus and a united Team Canada approach, the same approach that has carried us to this point.”
That “Team Canada” approach appeared under severe strain, however, as leaks first reported by U.S. media and confirmed by sources to the Star outlined a plan under which the U.S. would reduce existing 25 per cent auto tariffs to 15 per cent with an exemption only for U.S.-made content and parts, but was refusing calls to treat Canadian auto content the same way.
Canadian steel would see U.S. tariffs drop from 50 to 25 per cent for a certain volume of shipments, above which it would continue to be tariffed at 50 per cent. Canadian aluminum would see U.S. tariffs drop from 50 to 25 per cent, according to those sources, whom the Star is not naming because they are not authorized to publicly discuss the talks. There does not appear to be talk of the same tariff-rate quota treatment for aluminum.
It remained unclear whether Canada has agreed to such trade-offs as greater access for U.S. dairy products, renewed sales of U.S. alcohol, relaxed “Buy Canadian” policies, an agreement to buy U.S. F35 fighter jets, American buyer privileges for Canadian critical minerals, or other energy guarantees.
Matthew Shoemaker, mayor of Sault Ste. Marie, home to the Algoma Steel plant, said agreeing to a 25 per cent reduction in steel tariffs “really hands the American administration a victory” and “reinforces that their negotiating strategy of doing something wholly unreasonable worked.”
“As mayor of city whose main export is steel I’m going to be vocal about the fact that this isn’t a good deal for this industry.”
Three opposition party leaders warned Carney against conceding too much to Trump.
Conservative Leader Pierre Poilievre rejected the idea of Carney inking a deal that would see 25 per cent tariffs applied to steel and aluminum, saying it risked the “deindustrialization” of the country should the prime minister accept a deal that included “one-sided tariffs.”
Bloc Québécois Leader Yves-Francois Blanchet warned that Quebecers had no appetite for any concessions on its supply management system, as NDP Leader Avi Lewis balked at the idea of Canada conceding its requirement for tech giants to pay for sharing Canadian news content.
Fears over what concessions Canada would hand to the U.S. mounted after a statement by issued by the United States Trade Representative late Tuesday — after Trump announced a three-day pause on his 50 per cent tariffs — naming “digital trade alignment” and “comprehensive market access for all American goods,” as features of the proposed deal with Canada.
Adding to the pressure was the fact premiers appeared divided over Carney’s request to lift their bans on selling U.S. alcohol, which remain in place in eight of 10 provinces. They said the prime minister made it clear U.S. alcohol sales needed to resume in order to land a trade deal.
Former Conservative leader Erin O’Toole, who sits on Ottawa’s Canada-U.S. advisory council, says he believes the Americans “overplayed” the state of talks earlier in the week as a way to apply pressure to the Canadian side.
“We should not be moved by that at all,” O’Toole said in an interview Friday. “It would be better to not have a deal than to accept a bad deal.”
Industry and other leaders in Canada cautioned the Carney government to show resolve in the face of U.S. pressure and suggestions that signing a deal would guarantee a level of certainty.
“Not all certainty is good. There is such a thing as bad certainty,” Unifor president Lana Payne told the Star earlier in the day.
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