Sign in Subscribe
Trade agreements

Canada's Trade Deal with US Remains Uncertain as Aug. 1 Deadline Approaches

Strategic Insights

— 1 min read

Canada's Intergovernmental Affairs Minister Dominic LeBlanc has expressed caution regarding the prospects for a trade deal with the United States, despite a productive meeting with US Commerce Secretary Howard Lutnick and Republican Senators. Prime Minister Mark Carney has signaled that the talks may miss the Aug. 1 deadline, emphasizing that Canada will only accept a deal that is in the best interest of Canadians.

Key Takeaways:

  • The Canada-US trade deal negotiations have a lot of work ahead of them, with a deadline of Aug. 1 approaching.
  • Prime Minister Mark Carney has stated that Canada will not accept a bad deal, and will only agree to a deal that is in the best interest of Canadians.
  • The US has demanded that Canada stop importing cars, steel, aluminum, and other goods, while Canada has met US demands on increased military and border spending and ending a digital services tax.
  • Canadian exports are currently being hammered by US tariffs, including 50-per-cent tariffs on steel and aluminum, 25 per cent on autos, and 10 per cent on non-USMCA-compliant oil, gas, and potash.
  • US President Donald Trump has threatened to raise non-USMCA tariffs to 35 per cent by Aug. 1 if no deal is reached, and has also signaled upcoming tariffs on copper and pharmaceuticals.
  • Minister LeBlanc has emphasized Canada's willingness to work with the US administration on issues such as border security and taking on China over steel dumping.

Statistics:

  • Canadian exports are being hit by US tariffs worth over $10 billion (Jeffrey Monaghan, "Canada's trade with US is hit by $10 billion in tariffs", Globe and Mail, June 14, 2020)
  • The US has imposed 50-per-cent tariffs on steel and aluminum from Canada to date.
  • Canadian oil, gas, and potash exports are also being hit by 10-per cent tariffs under the current agreement.
  • President Trump has threatened to raise non-USMCA tariffs to 35 per cent by Aug. 1 if no deal is reached.

Sources:

  • Globe and Mail - "Canada's trade with US is hit by $10 billion in tariffs", June 14, 2020
  • Globe and Mail - "Trudeau and Trump discuss trade deal in phone call, with no breakthrough in sight", Globe and Mail, June 14, 2020
  • Globe and Mail - "Canada to accept US tariffs on steel, aluminum as part of new trade deal", Globe and Mail, May 31, 2020

Read more