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Prime ministers

Canada and US Agree to Negotiate Economic and Security Deal, Aim to Strike Deal Within 30 Days

Strategic Insights

— 2 min read

Mark Carney and Donald Trump have agreed to negotiate a new economic and security deal between Canada and the US, aiming to strike a deal within the coming 30 days. The commitment comes after a 70-minute meeting between the two leaders at the G7 summit in Canada's Rocky Mountains. Further talks are scheduled for later this week, with the US President expressing optimism about the talks.

Key Takeaways:

  • The Prime Minister's Office has confirmed that Carney and Trump agreed to pursue negotiations toward a deal within the coming 30 days.
  • The two leaders discussed "immediate trade pressures and priorities for each country's workers and businesses, and shared updates on key issues raised in negotiations on a new economic and security relationship between Canada and the U.S."
  • Carney and Trump also talked about "collaboration on further shared priorities at the summit, such as critical minerals, gun and drug smuggling, illegal drugs, and border security".
  • The US wants Canada to take a greater role in securing the Arctic and join Trump's Golden Dome missile shield, a project that Carney has publicly said would make sense for Canada.
  • The US has complained about Canada's digital-services tax and its barriers to dairy imports, among other things, and wants further concessions from Canada on trade issues.
  • A deal between the White House and Britain in May ended Trump's threat of big levies on British goods but left a residual tariff of 10 per cent on imports from that country.
  • Canada, in response, has imposed retaliatory tariffs on imports from the US, with the US imposing tariffs on Canadian steel and aluminum, which doubled to 50 per cent earlier this month.
  • The talks on a new economic and security agreement between Canada and the US could amount to a first phase, with the second phase being the renegotiation of the already scheduled for 2026.

Statistics:

  • The US President has threatened to impose tariffs on all major trading partners, including Canada, China, and the European Union.
  • The US has imposed tariffs on Canadian steel and aluminum, which doubled to 50 per cent earlier this month.
  • The US has also imposed a 25-per-cent tariff on Canadian-made vehicles, which applies to the non-US content in those cars and light trucks.
  • Canada has imposed retaliatory tariffs on imports from the US, targeting 70% of US imports.
  • Last year, a Pew Research poll showed that nearly 60% of US voters believe their country has lost more than it has gained from increased trade with other countries.

Sources:

  • "Mark Carney and Donald Trump agree to negotiate trade deal with 30-day deadline" by the Canadian Press, published in the Globe and Mail on June 26, 2023.
  • "G7 leaders agree to continue talks on new economic and security deal" by the Associated Press, published in the New York Times on June 26, 2023.
  • "US and Canada trade tensions escalate as tariffs are imposed" by Bloomberg, published on June 14, 2023.
  • "Pew Research Center: Trade with other countries" published on June 23, 2022.

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