Mark Carney has made it abundantly clear that Canada will not accept a “bad deal” during ongoing talks between his nation and the US designed to resolve an ongoing trade dispute. While Ottawa seeks tariff relief, Carney stressed any agreement must serve Canada’s long-term interests rather than simply meet an artificial deadline.
On July 22 in Huntsville, Ontario, Carney told reporters that Canada will not settle for any deal that compromises Canadian interests and is determined not to reach a deal no matter the cost. Her objective is pursuing one in line with Canadian priorities..
His comments came following heated negotiations between Canada and the U.S. as Washington considers raising tariffs on Canadian imports not covered by the USMCA agreement.
Negotiators now have until August 1 to reach an accord before U.S. tariff increases are implemented, though Carney and provincial premiers have publicly downgraded expectations of reaching an early resolution, emphasizing that reaching beneficial terms should take priority over meeting deadlines. (Wikipedia + 5; Politico +5; New York Post = 5.)
Carney has taken a strong stand against U.S. tariff threats since March. Ottawa responded with retaliatory duties and pledged to increase economic resilience through diversification; these promises can be found here on Reuters +15, Yahoo Style +15 and AP News (+15).
Prime Minister Theresa May has adopted a multipronged strategy: matching U.S. auto tariffs, imposing new quotas and protecting critical sectors (AP News).
Carney has taken steps to increase Canada’s trade diversification efforts as the U.S. economy remains too reliant. Talks are underway with Mercosur nations, China, India and the UAE about diversifying trade – as well as initiatives within Canada itself that enhance internal trading and provide new revenue sources. A recent Indo-Pacific free trade pact and initiatives for improving internal trade support this pivot. For further reading please check: New York Post/Reuters/Polito
Financial markets have responded cautiously to Carney’s remarks. The Canadian dollar recently strengthened to two-week high as investors assess mixed signals relating to tariff pressures balanced against resilience strategies provided by government, per Reuters.
Economic analysts suggest Carney’s resolve could fundamentally alter Canada’s trade posture. Business Insider reports the crisis has inspired an “Buy Canadian” movement and renewed dedication to domestic supply chains; “tariff turbulence has galvanized a sense of national resilience and opportunity,” analysts conclude.
Concerns remain, though. U.S. automakers have voiced displeasure with a separate trade deal reducing Japanese auto tariffs to 15% while maintaining 25% duties on Canadian imports (Reuters/The Financial Express, August 29th 2018).
Such disparate treatment by Washington compounds the complexity of Canada’s negotiation efforts.
Carney’s government also adjusted their cabinet structure in response to this new challenge, creating new portfolios in May that focused on trade, industry and diplomacy to strengthen Canada’s negotiating position and position at global events such as WTO WTO WTO
But domestic issues remain pressing as well: First Nations leaders recently withdrew from infrastructure consultations citing inadequate engagement; this incident highlighted just how Carney is facing both domestic and international pressures on his government, reports The Guardian.
Carney has clearly set forth his policy stance: Canada will seek relief from punitive U.S. tariffs but must do so without jeopardizing national interests. A tight timeline exists ahead, making it imperative that Washington agree to terms that respect Canada’s core sectors while minimizing future exposure to U.S. economic pressures.