Prime minister Carney announced Canada–U.S. Trade Policy

Prime minister Carney announced Canada–U.S. Trade Policy Announcement .


In recent years, the United States has shifted towards a more protectionist trade stance under the Trump administration, introducing policies such as tariffs on imported goods, protecting strategic sectors, and demanding changes in trade partners' domestic policies. In response, Canada has implemented retaliatory tariffs to protect its economic interests.

Recent Developments and Key Announcements

The United States has reaffirmed its commitment to the Canada–U.S.–Mexico Agreement (CUSMA), a crucial trade agreement between the three nations. In light of this development, Canada has made several key announcements to adapt to the evolving trade landscape:

1. Tariff Matching: Canada will eliminate its tariffs on U.S. goods covered by CUSMA, mirroring the U.S. granting tariff exemptions on Canadian goods, effective September 1st of this year.

2. Strategic Sectors: Canada will maintain tariffs on steel, aluminum, and automobiles as negotiations continue to address issues in these sectors.

Current Trade Position and Outlook

The current state of trade between Canada and the U.S. is characterized by:

85% of trade being tariff-free
An average U.S. tariff on Canadian goods of 5.6%, significantly lower than the global average of 16%
Canada maintaining the most favorable trade deal with the U.S. compared to other countries

Future Actions and Initiatives

To build on the progress made, the government has outlined several future actions:

Launching consultations next month ahead of the CUSMA review in 2026
Introducing a new Canadian industrial strategy, focusing on:
    + Support for sectors affected by U.S. trade measures
    + Promotion of Canadian goods
    + Increased export diversification
Announcing new nation-building infrastructure projects shortly
Working to establish a new trade and security partnership with the U.S.

International Engagement and Cooperation

Prime Minister Mark Carney will travel to Germany next week to meet with the Chancellor and key ministers, focusing on:

Deepening economic and security ties between Canada and Germany
Discussing critical minerals, defense, and energy collaboration

Security and Support for Ukraine

Canada is participating in multilateral discussions with the U.S., EU, and others to offer post-conflict security guarantees for Ukraine. Canadian officials are in communication with U.S. and European counterparts to create frameworks for Ukraine's defense following the cessation of hostilities.

Addressing Criticism and Concerns

Some critics argue that Canada is "giving in" to U.S. demands. The government's response is that Canada is taking strategic steps to protect jobs and market access while preparing for future trade developments. Canada is not considering raising tariffs in other sectors at present but remains flexible based on negotiation outcomes. Close collaboration with provinces and industries is ongoing to support those affected by U.S. trade actions.

Next Steps and Future Directions

In the coming weeks and months, Canada will focus on:
The Prime Minister's trip to Germany to discuss deepening ties and explore new economic opportunities. Continued engagement with international partners on security matters, including Ukraine

By taking a proactive and strategic approach to trade policy, Canada is poised to navigate the complex global trade landscape, protecting its economic interests while promoting cooperation and collaboration with international partners.