Canada vs. Trump: Mark Carney Faces Pressure Amid Tariff Threats
A New Tariff Storm: Trump’s 35% Threat Looms Over Canada
In a surprising escalation in the ongoing Canada-U.S. trade war, President Donald Trump has threatened to impose a staggering 35% tariff on Canadian goods starting next month. This latest move comes as both nations engage in intense negotiations aimed at securing a new trade deal, leaving many to wonder how this tariff threat will impact the discussions.
Mark Carney’s Tough Talk: Can He Deliver?
Canada’s new Prime Minister, Mark Carney, who won the April general election on a platform of assertiveness—vowing to keep his “elbows up” in the face of U.S. threats—now faces scrutiny over his ability to stand firm against Trump. While Carney initially promised a confrontational approach, recent concessions to the U.S. have raised questions about his strategy and effectiveness.
Concessions and Controversies: The Digital Services Tax Reversal
One of the most notable concessions came in late June when Canada scrapped its planned Digital Services Tax (DST) aimed at large tech companies after Trump threatened to halt negotiations. The White House claimed victory, stating that Canada had “caved” to its demands, prompting a wave of criticism from Canadian commentators. Robyn Urback remarked, “Maybe Prime Minister Mark Carney's elbows were getting tired,” suggesting that the government’s approach has been inconsistent.
Critics Weigh In: Is Carney’s Strategy Flawed?
Political analysts are divided on Carney’s approach. Blayne Haggart, a political science professor at Brock University, criticized Carney’s strategy as lacking coherence, stating that the reversal on the DST achieved “less than nothing.” However, some experts argue that it is too early to judge Carney’s effectiveness, with polls indicating strong support for his government.
Roland Paris, a former adviser on Canada-U.S. relations, cautioned against premature conclusions, noting that much will depend on the final agreement. He warned that if Carney appears to have capitulated to Trump, he could face significant political repercussions at home.
Navigating a Complex Landscape: Canada’s Position
Before the DST reversal, Canada had already made concessions, including pledging C$1.3 billion to enhance border security and appointing a “fentanyl czar” in response to Trump’s claims about drug trafficking. Despite these efforts, Carney has not retaliated against Trump’s recent doubling of tariffs on steel and aluminum.
In response to the new tariff threat, Carney stated, “Throughout the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and businesses.” He reaffirmed Canada’s commitment to negotiating a fair deal, with a revised deadline set for next month.
A Silver Lining: Exemptions Under the USMCA
Fortunately for Canada, the new tariff will not apply—at least for now—to goods covered under the US-Mexico-Canada Agreement (USMCA), which encompasses a significant portion of cross-border trade. This exemption offers a glimmer of hope amid the uncertainty.
Bipartisan Unity Against Tariffs
Domestically, Canadians across the political spectrum are united in their opposition to Trump’s tariffs. Conservative leader Pierre Poilievre expressed his party’s commitment to securing the best deal for Canada, while British Columbia Premier David Eby emphasized the need for national solidarity in the face of external pressures.
Leverage in Negotiations: Canada’s Hidden Strengths
Despite its smaller economy, Canada still holds some leverage in negotiations. Fen Hampson, a professor of international affairs at Carleton University, pointed out that it is American consumers who will ultimately bear the cost of the tariffs. Many U.S.-based manufacturers rely on Canadian products, such as steel and aluminum, which are currently subject to steep tariffs.
Hampson noted, “You can't judge the outcome of negotiations by the last move or the concession that's made. You can only judge it by its outcome.” He also highlighted Carney’s efforts to reduce reliance on the U.S. by pursuing trade agreements with other partners, including an arms deal with the European Union.
A Cautious Approach: Canada’s Strategy Moving Forward
Pressed on Trump’s latest threat, Canada’s Industry Minister Melanie Joly stated that the government “does not negotiate in public” and denied claims that Canada is failing to stand up to Trump. “We’re dealing with a very unpredictable U.S. administration,” she remarked, emphasizing that Canada is not alone in facing these challenges.
As negotiations continue, the outcome remains uncertain, but one thing is clear: the stakes are high for both Canada and the U.S.