(Bloomberg) — Canada made new and detailed proposals on trade to the US based on negotiating progress in recent weeks, said Canadian cabinet minister Dominic LeBlanc.<\/p>\n
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\u201cA strong, prosperous Canadian economy is good for North America, and we discussed how we can work together on a number of issues that strengthen the competitiveness of the North American economy,\u201d he said at a press conference in Washington after a meeting with US Trade Representative Jamieson Greer.<\/p>\n
Prime Minister Mark Carney\u2019s government is under pressure to show that it\u2019s making strides in talks with the Trump administration, as Mexico has already begun bilateral negotiations with the US on renewal of the US-Mexico-Canada Agreement, or USMCA.<\/p>\n
LeBlanc refused to share details of the proposals but downplayed suggestions that Canada was being left behind Mexico. Discussions with US policymakers will continue in the coming days \u2014 but he also warned that talks could still take a negative turn and that \u201cturbulence\u201d is to be expected.<\/p>\n
\u201cAll of us know that the road to conclusions in these conversations is sometimes not a straight line,\u201d said LeBlanc, a longtime politician and senior cabinet minister who\u2019s responsible for Canada-US trade.<\/p>\n
He emphasized several times that the USMCA pact simply continues if not renewed by July 1, though it\u2019s thrown into a process that may amount to years of rolling negotiation and even possible expiry in 2036.<\/p>\n
Canada\u2019s chief trade negotiator, Janice Charette, also attended the meeting with Greer.<\/p>\n
Tuesday\u2019s meeting was preceded by a social media post from US President Donald Trump in which he reprised his description of Canada as a \u201c51st state,\u201d while highlighting a Bloomberg News story that Canada\u2019s economy had dipped into a technical recession. Trump\u2019s post was also shared by the US ambassador to Canada.<\/p>\n
Hours after LeBlanc\u2019s news conference, the US proposed new tariffs on imports from 60 trading partners after an investigation into how countries handle goods allegedly produced by forced labor. A 10% tariff rate would apply to imports from Canada, Mexico, the European Union, Taiwan and the UK, among other regions. China, India and other nations would be subject to a 12.5% levy.<\/p>\n
The move is a major step in Trump\u2019s push to reinstate tariffs he imposed in 2025, before they were deemed unconstitutional by the US Supreme Court.<\/p>\n
However, the new tariff won\u2019t apply to USMCA-compliant goods from Canada and Mexico, according to the notice from the US Trade Representative. That mirrors an earlier exemption to Trump\u2019s so-called IEEPA tariffs \u2014 the ones that were thrown out by the high court.<\/p>\n
The Canadian government has shared information to try and address US concerns, LeBlanc said on Tuesday \u2014 stressing its commitment to fighting forced labor, for instance.<\/p>\n
LeBlanc said Canada once again made its argument against US tariffs imposed on key industries: autos, steel, aluminum and softwood lumber.<\/p>\n
Earlier on Tuesday, Carney said the US-Mexico negotiations started first because those countries have more to discuss. The US has about 60 technical trade issues with Mexico compared with about 30 for Canada, Carney told reporters before a meeting of his cabinet in Ottawa.<\/p>\n
The prime minister said Canada is particularly focused on addressing Trump\u2019s sectoral tariffs. And he confirmed the White House has been pushing for new rules on auto production that would require at least 50% US components for vehicles manufactured in the North American trade zone. He didn\u2019t endorse that position, but noted that Canadian-built cars already meet that threshold, on average.<\/p>\n
The USMCA includes provisions that require 75% of a vehicle\u2019s value to come from North America to qualify for tariff-free treatment. Last year, however, Trump imposed new duties on cars made in Mexico and Canada despite that clause.<\/p>\n
Before heading to Washington, LeBlanc released a letter that praised the merits of the six-year-old trade agreement. Canada wants the deal renewed for another 16 years but is willing to consider proposals that will benefit the prosperity of all three nations, it said. He said he\u2019s received letters from the US and Mexican representatives on their positions but declined to share what they said.<\/p>\n
The neighbors could agree on a different scenario or schedule, LeBlanc said, \u201cso I think we\u2019ve got to be careful not to set up a cliff that doesn\u2019t exist.\u201d<\/p>\n
(Updates with information that USMCA-compliant goods are exempt from the proposed new tariffs in the 11th paragraph.)<\/p>\n
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