The people leading Canada’s trade talks are not as worried as you might think about Donald Trump’s latest threats to end North American free trade.
It was somewhat jarring, this week, to take in the calm demeanour projected by chief trade negotiator Janice Charette, at an automotive conference, and lead cabinet minister Dominic LeBlanc, and ambassador Mark Wiseman at a Canada-U.S. summit convened by the Eurasia Group.
There was Trump, claiming he was “not looking to renew” the Canada-U.S.-Mexico-Agreement (CUSMA), while also seemingly poking Canada by impeding the opening of the Gordie Howe International Bridge between our countries.
And here were Mark Carney‘s top people on the file, insisting trade talks are proceeding cordially behind the scenes, boasting how often they exchange texts with their American counterparts, and still flirting with the idea of Fortress North America taking on the world.
That last notion might be a bit tough to take seriously, and it wouldn’t be terribly well-advised at the moment to further put in our lot with Trump’s America at the potential expense of other relationships.
But as a whole, the reassurances about the future of the continental trade relationship are not just political spin. And it would probably be wise for Canadians to follow the government’s lead in being calm — even if there are a couple of big asterisks.
As LeBlanc in particular keeps reminding us, there’s no great urgency to the July 1 date.
Some have misinterpreted that date as a deadline for renewing (or abandoning) CUSMA. But it actually marks the date when the three countries have to officially begin their review of the existing agreement.
Even if we failed to reach an agreement with the U.S. after that date, CUSMA wouldn’t automatically expire, as Trump seemed to suggest. Instead, the agreement would remain in place until 2036. It would, however, be subject to continued annual reviews, and it wouldn’t be extended for an additional 16 years to 2052.
While it’s theoretically possible for Trump to pull the U.S. out of the agreement at any time regardless of the review process with six months’ written notice, few in Ottawa seem to take that possibility terribly seriously either.
That’s largely because withdrawal would likely require congressional approval, and it’s far from clear Trump would be able to get enough votes there even now, let alone after expected Democratic gains in November’s midterm elections.
It’s also because, for all his bluster, Trump has yet to prove willing to run afoul of the U.S. business community to the degree he would by ending free trade.
And although it’s impossible to know what’s happening behind closed doors, most government and industry insiders are under the impression that early negotiations are indeed proceeding constructively. U.S. trade representative Jamison Greer, Charette’s counterpart, seems to be a fairly rational and understated presence, by the standards of the Trump administration at least.
Now for the asterisks, lest anyone get too sanguine.
Canada doesn’t just need CUSMA to survive. The biggest negotiating objective from its perspective is relief from the tariffs that Trump has separately imposed on our automotive, steel, aluminum and forestry industries.
Just waiting out Trump isn’t an option, because the longer tariffs continue at or near current levels, the greater the risk of permanent closures of automotive and steel plants (both concentrated in Ontario).
Securing that relief will likely require trade-offs, which are also a valid cause for Canadian concern. How much will Ottawa feel compelled to further abandon attempts to assert digital sovereignty and defer to Trump-aligned U.S. tech giants, for instance?
Then there’s the uncertainty of how much the constructiveness of the technical negotiating process even matters, with this U.S. President.
As we’ve seen time and again, what’s happening in the public realm — something he sees on Fox News, something Doug Ford says, whatever — can cause Trump to rashly try to punish his perceived enemies. And as Charette acknowledged during her appearance this week, there are people in this White House who are much more adversarial than Greer, and have Trump’s ear. (She didn’t explicitly invoke Howard Lutnick, reportedly a driving force behind the Gordie Howe weirdness, but he immediately sprung to mind.)
But that unique unprofessionalism in Washington is also an underlying reason Ottawa is trying to brace Canadians for all the sound and fury this summer.
The message to stay cool was delivered to business and industry audiences this week, to try to limit the turbulence’s impact on investment decisions.
But the rest of us should heed it as well — if only to keep our sanity.
