Carney links Trump's latest tariff threat to negotiations on CUSMA

It is non a happenstance that U.S. Chairwoman Donald Trump's in style(p) tariff threat against Canada came simply ahead of negotiations on renewing North America's main free-trade pact, Prime Minister Mark Carney said on Monday.

"The president is a strong negotiator and I think some of these comments and positioning should be viewed in the broader context of that," Carney said at an unrelated announcement in Ottawa on Monday.

In a weekend social media post in which he referred to Carney as "governor," Trump threatened to impose 100 per cent tariffs on Canadian goods if Ottawa reaches a trade deal with China.

In subsequent posts, Trump wrote "China is successfully and completely taking over the once Great Country of Canada," adding, "I only hope they leave Ice Hockey alone!"

The Canada-U.S.-Mexico-Agreement (CUSMA) was negotiated during the first Trump administration and served as an early stress test for Ottawa.

There were tensions during the talks and Trump repeatedly threatened to impose tariffs, but ultimately the agreement, which replaced the North American Free Trade Agreement, was signed and all three countries hailed it a success.

LeBlanc says he reaffirmed CUSMA terms with U.S. Trade representative after China deal

The agreement's future is much less certain now, as Canada, Mexico and the United States prepare for the mandatory review. Trump said earlier this month the trade deal was "irrelevant" to him.

The president previously called the deal "transitional" and, during a meeting with Carney at the White House last October, said it may have served its purpose.

Despite the president's angry social media outbursts over the weekend, Canada-U.S. Trade Minister Dominic LeBlanc said he had a cordial and lengthy phone conversation with Trump's trade czar on Sunday.

LeBlanc said he was reassured when U.S. Trade Representative Jamieson Greer indicated a clear desire to work on the CUSMA review. LeBlanc said he told Greer Ottawa is ready to have detailed conversations quickly, and they committed to holding a call later this week and to meeting in person soon.

Greer himself has expressed skepticism about the continental trade agreement. Greer previously said the Trump administration is also considering splitting up the three-way pact and negotiating separate deals with Canada and Mexico.

Carney said he expects the CUSMA review to be "robust." Trump's public comments over the past year show Canada shouldn't expect a smooth ride through the process.

Trump says CUSMA is 'irrelevant,' targets auto trade with Canada

Trump originally expressed support for Ottawa's agreement with China but he changed his tune after Carney's widely praised speech at the World Economic Forum in Davos, Switzerland, last week.

In his comments, which were later cited by European leaders, the prime minister warned that the old world order is dead and urged middle powers to band together as larger ones try to pressure them through economic coercion.

Carney said Monday that his WEF comments were a recognition of how the world has changed and "Canada had understood the scale of the change" well before other countries.

In the days after the speech, members of the Trump administration warned Ottawa's recent deal with China could upend the CUSMA review.

LeBlanc said he explained to Greer that Canada is committed to the CUSMA provision that forbids the three partner nations from entering into free-trade agreements with non-market economies such as China. LeBlanc said Greer understands Canada's narrow agreement with Beijing sorts out long-standing trade tensions over electric vehicles and agricultural products.

CUSMA has shielded Canada and Mexico from the worst impacts of Trump's tariffs. The president increased duties on Canada to 35 per cent last August, citing the cross-border flow of deadly fentanyl as justification. Those tariffs do not apply to goods compliant with CUSMA.

Canadian industries are also being slammed by separate tariffs on goods like steel, aluminum, automobiles, lumber and cabinets.

Reporter

Kyle Duggan is a reporter for The Canadian Press.

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