Canada–US trade tension
- Canada's new majority government under Mark Carney is pursuing a bilateral trade deal with the United States. - That push comes as the US has already applied 25% tariffs in some areas and threatens 100% duties on pharmaceuticals. - Carney must redefine ties with an administration using coercive commercial tactics, making predictable access to US markets uncertain. ( )
Mark Carney’s new majority government is moving to negotiate a one-on-one trade deal with Washington as Canada faces new U.S. tariff pressure. (reuters.com) Reuters reported on April 22 that Carney wants a bilateral agreement with the United States rather than waiting for broader stability in the existing North American framework. The push comes after his party secured a parliamentary majority, giving Ottawa more room to negotiate. (reuters.com) Canada is trying to negotiate while the United States is already using tariffs as leverage. A House of Commons Library briefing published April 14 said the Trump administration has imposed 25% tariffs on steel, aluminum and autos in some cases and has threatened 100% duties on pharmaceuticals. (commonslibrary.parliament.uk) The timing collides with the formal review of the United States-Mexico-Canada Agreement, the regional pact that replaced the North American Free Trade Agreement on July 1, 2020. The Office of the United States Trade Representative said in December 2025 that the joint review is due by July 1, 2026. (ustr.gov) Washington has already started that review with Mexico. On March 5, 2026, United States Trade Representative Jamieson Greer and Mexico’s economy secretary, Marcelo Ebrard, announced bilateral talks on rules of origin, supply chains and reducing dependence on imports from outside North America. (ustr.gov) That leaves Ottawa trying to protect access to its biggest export market while the rules are still in play. Global Affairs Canada said the United States took 71.7% of Canadian goods exports in 2025, even after that share fell to its lowest level since the early 1980s. (international.canada.ca) The trade relationship is still enormous in absolute terms. Global Affairs Canada said bilateral goods trade with the United States hit a record in 2024, and Canada still ran an $81.6 billion goods surplus with the U.S. in 2025. (international.canada.ca; international.canada.ca) The pressure is uneven across sectors. Canada’s March 2025 trade report said exports of motor vehicles and parts rose as companies moved shipments around actual and threatened U.S. tariffs on autos and other goods. (international.canada.ca) The U.S. side says the review is about tightening North American production rules and supply-chain security. The Canadian side is trying to lock in predictability before more tariffs land, especially in industries where a border tax can wipe out margins overnight. (ustr.gov; reuters.com) Carney now has the votes at home to pursue a deal, but the harder question is in Washington. Canada is negotiating with a U.S. administration that is treating tariff threats as part of the bargaining itself. (reuters.com; commonslibrary.parliament.uk)
