With just days remaining before a key trade deadline, U.S. President Donald Trump signaled a grim outlook for Canada-U.S. trade negotiations, warning that Canada could face steep tariffs as of August 1 if a deal isn’t reached.
“We don’t have a deal with Canada,” Trump told reporters during a press briefing on Friday. “We haven’t really had a lot of luck with Canada. I think Canada could be one where they’ll just pay tariffs. It’s not really a negotiation.”
The president said his administration had made significant headway on other international trade fronts, including finalized terms with China, breakthroughs with Australia, and positive progress toward a deal with the European Union. Australia recently lifted restrictions, opening the door for more American beef exports—an outcome Trump touted as a “big win.”
By contrast, talks with Canada appear to be floundering, despite ongoing behind-the-scenes efforts. Canadian Minister of Intergovernmental Affairs Dominic LeBlanc, who oversees the U.S.-Canada trade file, said he remained “encouraged” after a recent closed-door meeting with U.S. Commerce Secretary Howard Lutnick and a bipartisan group of senators. However, LeBlanc acknowledged that discussions remain “complex” and may not wrap by the looming August 1 deadline.
That’s when Trump has pledged to impose a 35% tariff on Canadian goods not already covered under the existing bilateral free trade agreement—an accord that Trump signed during his first term and has vowed to renegotiate next year. The new tariffs would hit Canadian industries already contending with U.S. duties on steel, aluminum, and automobiles. Copper exports are also expected to face new levies.
LeBlanc is expected to return to Washington next week for another round of high-stakes discussions, although Canada’s negotiators appear willing to miss the deadline if it means achieving a more favorable long-term outcome.
“We’re still working toward August 1,” LeBlanc said, “but we’re not going to rush into a bad deal just to meet a date.”
Trump, meanwhile, has released formal letters addressed to various world leaders outlining proposed tariffs, calling them essentially “contracts.” “When those letters go out—they’re a page and a half—that means they have a deal,” he said, adding that even after the letters are sent, some countries return to the negotiating table, as seen with Japan and the EU.
Canada received such a letter, indicating the proposed 35% tariff, but so far, talks have failed to yield a breakthrough. Ottawa’s challenge remains balancing the mounting economic pressure from U.S. tariffs with the political and economic need to secure a trade deal that doesn’t leave Canadian industries vulnerable in the long run.
