Mark Carney has said Canada will drop all retaliatory tariffs against the US that apply to products covered by the Canada-US-Mexico Agreement.
In a starkly different tone from the one he adopted during his campaign to become both the Liberal Party leader and prime minister, Carney said “Canada currently has the best trade deal with the United States” which is “better than that of any other country.”
The PM said the decision to “match” the US on tariffs will take effect on Sept. 1. It means import taxes will stay in place on aluminum, steel and auto products from the US, but be removed from products compliant with CUSMA.
US officials have long complained about Canada’s decision to strike back against Donald Trump’s tariffs, with Commerce Secretary Howard Lutnick particularly vocal.
Speaking in the White House today, the president said he's pleased the tariffs have been dropped and said of Carney: "I like him a lot." But he added: "I'm fighting for the United States. Canada and Mexico have taken a lot of our business over the years."
He also said: "We want to be very good to Canada."
Canada – under Prime Minister Justin Trudeau – put tariffs on the likes of orange juice, booze and motorcycles in response to Trump’s decision to levy a 25 per cent import tax on Canadian goods. The White House later clarified that CUSMA-compliant goods would be exempted from the tax.
Speaking today, Carney said: "In previous trade disputes, Canada has implemented a series of retaliatory tariffs. Their objectives have been to protect Canadian workers and businesses, and to incentivize a negotiated settlement with the United States. Few other countries have followed suit."
His announcement comes a day after his office said the PM had a “productive” conversation with Trump over the phone.
Asked today whether Trump said dropping counter-tariffs would "kickstart negotiations," Carney replied simply: "Yes."
The prime minister also said today that Ottawa is preparing for the renegotiation of CUSMA, which is set to occur next year.
Carney pledged during his campaigns to lead the Liberals and the country to resist US attempts to “own” Canada.
He promised an “elbows up” approach to the Americans, matching their aggression with a strong defensive posture.
But despite meeting with the president and aiming to agree a deal with the US by July – and then August – the challenge presented by Trump has not been solved.
Asked by a reporter today if he'd adopted an "elbows down" approach to Trump, Carney said he'd "played some hockey over the years," adding: "There is a time in a game, in a big game, and this is a big game, when you go hard in the corners, your elbows up – the time in a game we drop the gloves in the first period and you send a message. And we've done that, pretty uniquely in the world."
He went on with the analogy: "But there's also a time in a game where you want the puck, you want the stick handle, you want to pass, you want to put the puck in the net. And we're moving later into the game, and we're at that time in the game, and that's where the engagement is."
Tory Leader Pierre Poilievre has gone so far as to say Carney has failed in his job of negotiating a deal with the Americans. The Liberals, however, have insisted they will only agree to a deal that works for Canada.
Reacting to Carney's announcement today, Poilievre said the prime minister had offered "a series of very generous concessions to President Trump" but got nothing in return.
"Today we learn that it is yet another capitulation and climbdown by Mark Carney," he said. "His elbows have mysterious gone missing."
