Trump expresses ambivalence about future of US-Mexico-Canada trade deal during meeting with Carney

WASHINGTON — President Donald Trump said Tuesday he is willing to extend the free trade agreement with Mexico and Canada through renegotiation or seeking “different deals” during his meeting with Canadian Prime Minister Mark Carney at the White House.

Carney made his second visit to the Oval Office ahead of next year’s review of the United States-Mexico-Canada Agreement, and one of the world’s most enduring and friendly alliances has been shattered by Trump’s trade war and threats of annexation.

The free trade agreement was passed during Trump’s first term and allows the majority of Canadian and Mexican products to be shipped to the United States without tariffs. But Trump has made clear since returning to power that he wants to reshape the relationship, and he has expressed ambivalence about the process as long as he feels he can improve America’s position.

“We could renegotiate it, and that would be good, or we can just make different deals,” he said. “We are allowed to make different deals if we want. We could make deals that are more beneficial to each country.”

These remarks suggest that Trump is willing to allow uncertainty about the future of the deal to persist.

Carney came on the visit hoping to find some relief on sector-specific tariffs. Canada fears what will happen to the United States-Mexico-Canada Agreement, which is essential to the Canadian economy. More than three-quarters of Canadian exports go to the United States

Trump showed fondness for Carney — something he did not have toward Carney’s predecessor, Justin Trudeau — but noted that there was a “natural conflict” between the two countries, a point the prime minister politely disagreed with.

“We want Canada to do well,” Trump said. “But you know, there comes a time when we want the same stuff too.”

When asked why the United States and Canada had not reached a trade agreement, Trump said it was a complicated situation.

“We are facing a natural conflict,” he said. “We also have mutual love.”

Carney said he wouldn’t use the word “conflict.”

“There are areas where we compete, and those are the areas where we need to come to an agreement that works. But there are other areas where we are stronger together, and that’s where we’re focused.”

Trump’s remarks aimed at making Canada the 51st state and his customs tariffs arouse among Canadians an undeniable feeling of betrayal. The US president jokingly referred to a “merger” between the two countries at the top of his speech on Tuesday.

Relations with Canada’s southern neighbor and long-time ally are at an all-time low.

“We’ve had our ups and downs, but this is the lowest point in our relationship that I can remember,” said Frank McKenna, former Canadian ambassador to the United States and current vice-president of TD Bank.

“I talk every day with everyday citizens who are changing their vacation plans, and I talk with owners of large companies who are moving executive award trips or business trips,” McKenna said. “There is a real rebellion. »

Carney said the USMCA is a benefit to Canada at a time when it’s clear the U.S. is charging for access to its market. Carney said the U.S. commitment to the heart of the USMCA means more than 85 per cent of Canada-U.S. trade continues to be tariff-free. He said the average U.S. tariff rate on Canadian products is 5.6% and remains the lowest among all its trading partners.

But Trump is imposing sector-specific tariffs on Canada, known as Section 232 tariffs, that are having an impact. For example, there are customs duties of 50% on imports of steel and aluminum.

After the meeting, Dominic LeBlanc, the minister responsible for Canada-U.S. trade, called the negotiations “fruitful” and “positive” on trade issues, while noting that the conversation would continue. He said Canada was looking to quickly reach a deal on steel and aluminum.

The ties between the two countries are unprecedented. About $2.5 billion (nearly $3.6 billion Canadian) worth of goods and services cross the border every day. Canada is the primary export destination for 36 U.S. states. There is close cooperation in defense, border security and law enforcement, as well as extensive overlap in culture, traditions and hobbies.

About 60% of U.S. crude oil imports come from Canada and 85% of U.S. electricity imports come from Canada.

Canada is also the largest foreign supplier of steel, aluminum and uranium to the United States and has 34 critical minerals and metals that the Pentagon eagerly seeks and invests in for national security.

“The biggest prize would be to get a mutual agreement to negotiate free trade relations as quickly as possible,” McKenna said. “If the United States threatened to give us six months’ notice of layoffs, I think it would be a serious chill across North America.”

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Associated Press writer Chris Megerian in Washington contributed to this report.

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