The United States and Canada are in urgent trade talks as a deadline approaches for a possible agreement. Negotiations resumed on Friday. Both countries are trying to finalize a deal before new tariffs from President Donald Trump take effect. Trump has warned that he will impose a 50% tariff on about $20 billion worth of Canadian goods starting Saturday at 12:01 AM EDT (0401 GMT) if no agreement is reached, according to Reuters.
Key Details
Canadian Trade Minister Dominic LeBlanc met with US Trade Representative Jamieson Greer for over three hours on Thursday. LeBlanc said the two sides are "very close" to reaching a deal, but he noted that more work is needed. Canada is looking for relief from US tariffs on key sectors like automobiles, steel, and aluminum. These tariffs have hurt its economy and strained relations between the two countries.
Details of the potential agreement suggest that tariffs on Canadian-built vehicles could drop from 25% to 15%. Tariffs on Canadian steel and aluminum might be cut in half to 25%. However, the proposed deal would not fully restore trade conditions to what they were before Trump's administration. Saskatchewan Premier Scott Moe said that the pre-Trump "status quo" is no longer an option. He highlighted the challenges Canadian leaders face during these negotiations.
Background
In contrast, Manitoba Premier Wab Kinew criticized the proposed deal. He urged Canada to hold out for better terms. Kinew expressed concerns about concessions that could weaken Canada's position, especially regarding the restoration of US alcohol sales in Canadian liquor stores. His stance reflects broader worries among Canadian leaders about the effects of any agreement with the US.
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The outcome of these negotiations could greatly affect Canadian exports, especially in the automotive and metals sectors. New tariffs would raise costs and disrupt trade flows. Investors will closely watch for the final decision on tariffs and any new trade terms that come from the talks.
Based on reporting by: livemint.com, bbc.co.uk