{"id":56198,"date":"2025-09-11T00:04:07","date_gmt":"2025-09-11T00:04:07","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/56198\/"},"modified":"2025-09-11T00:04:07","modified_gmt":"2025-09-11T00:04:07","slug":"canada-lays-the-groundwork-to-pivot-away-from-the-united-states","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/56198\/","title":{"rendered":"Canada Lays the Groundwork to Pivot Away From the United States"},"content":{"rendered":"

This piece is part of a joint CFR analysis<\/a> assessing the geopolitical effect of the Trump administration\u2019s tariffs policy on traditional U.S. allies, including Canada as well as the European Union<\/a>, Japan<\/a>, and Australia and New Zealand<\/a>.\u00a0<\/p>\n

More From Our Experts<\/p>\n


\n Manjari Chatterjee Miller
\n <\/a><\/p>\n


\n Divergence Despite Convergence: The United States-India Strategic Partnership and Defense Norms
\n <\/a><\/p>\n

Edward Alden is senior fellow at the Council on Fore\u00ad\u00ad\u00adign Relations (CFR), specializing in U.S. economic competitiveness, trade, and immigration policy.\u00a0<\/p>\n

More on:<\/p>\n

\n Canada<\/a>\n <\/p>\n

\n United States<\/a>\n <\/p>\n

\n Tariffs<\/a>\n <\/p>\n

\n Trade War<\/a>\n <\/p>\n

\n Greenberg Center for Geoeconomic Studies<\/a>\n <\/p>\n

For the past seventy-five years, the United States and Canada have pursued ever closer economic and military cooperation<\/a>, celebrated \u201cthe world\u2019s longest undefended border,\u201d and built a friendship that was among the deepest between any two countries in the world. That all ended on March 26, 2025, when U.S. President Donald Trump announced he would impose 25 percent tariffs<\/a> on auto imports, including its largest suppliers Canada and Mexico which had long been guaranteed tariff-free trade under ratified agreements with the United States.<\/p>\n

The fallout has forced Canada to develop a new plan to face down an antagonistic United States. It is built on three pillars: unifying its economy domestically, bolstering military spending, and seeking deeper ties with European allies. Each involves a radical break with the past.<\/p>\n

This pivot essentially began when Canada\u2019s new Liberal prime minister, Mark Carney\u2014who would go on to win an upset election victory in April\u2014delivered the eulogy<\/a> for the U.S.-Canada relationship in a televised address to forty-one million Canadians the day after the tariffs were announced. \u201cThe old relationship we had with the United States, based on deepening integration of our economies and tight security and military cooperation,\u201d Carney proclaimed, \u201cis over.\u201d From here on, he told Canadians, the country would need to \u201cfundamentally reimagine\u201d its economy and ensure that Canada could \u201csucceed in a drastically different world.\u201d<\/p>\n

More From Our Experts<\/p>\n


\n Manjari Chatterjee Miller
\n <\/a><\/p>\n


\n Divergence Despite Convergence: The United States-India Strategic Partnership and Defense Norms
\n <\/a><\/p>\n

While Trump\u2019s tariffs and \u201cAmerica First\u201d unilateralism are reshaping relationships around the world, nowhere has the effect been more profound than in Canada. The country\u2019s response so far has been energetic and ambitious. But as U.S. tariffs start to bite\u2014Canada\u2019s economy shrunk by 1.6 percent<\/a> in the second quarter of 2025 largely due to falling exports, and its unemployment rate ticked above <\/a>7<\/a> percent<\/a> in August\u2014it is clear the hurdles are daunting.<\/p>\n

Canada measures almost 3,500 miles from west to east, but most of the population lives in a narrow corridor along its southern border. Trade and travel naturally run north-south rather than east-west. Despite efforts throughout its history to resist the economic pull of its southern neighbor, Canada took what it called \u201ca leap of faith<\/a>\u201d by entering into a free trade deal with the United States in 1989. By the early 2000s, some 85 percent<\/a> of Canadian exports were headed south and internal trade had languished.<\/p>\n

More on:<\/p>\n

\n Canada<\/a>\n <\/p>\n

\n United States<\/a>\n <\/p>\n

\n Tariffs<\/a>\n <\/p>\n

\n Trade War<\/a>\n <\/p>\n

\n Greenberg Center for Geoeconomic Studies<\/a>\n <\/p>\n

Now, Carney is working furiously to remove artificial barriers to inter-provincial trade. This includes addressing licensing and product standard restrictions that economists say could provide a s<\/a>mall boost<\/a> to Canada\u2019s gross domestic product (GDP), and new investments are being made to build out national infrastructure to diversify trade. Removing regulatory hurdles will be the easier part. Ontario, Canada\u2019s largest province, announced this month that it would open its doors<\/a> to regulated professionals, such as engineers and electricians from other provinces, and initiatives are moving ahead in other provinces as well.<\/p>\n

Building infrastructure will be harder. The Trans-Canada Highway is still a two-lane road in much of the country. Meanwhile, pipelines move most of Alberta\u2019s oil, its most valuable commodity, south to Gulf Coast refineries rather than east to Ontario and Quebec or west to British Columbia and markets in Asia. Carney has promised to bolster trade opportunities<\/a> with the rest of the world by expanding ports, building liquefied natural gas terminals, and opening access to new resources for export. On September 5, he announced a sweeping \u201cBuy<\/a> <\/a>Canadian\u201d policy<\/a> that will require the government to purchase from Canadian companies for all taxpayer-funded projects.<\/p>\n

Canada\u2019s defense policy has similarly been built along a north-south axis. The formation of the North American Aerospace Defense Command in 1958 made Canada a critical part of the U.S. early warning system against Soviet air and missile attacks. Otherwise, Canada\u2019s armed forces have remained small, used mostly for supporting NATO-led missions in Europe, Afghanistan, and elsewhere.<\/p>\n

Carney has promised to boost defense spending<\/a> from 1.4 percent of GDP to 2 percent by March 2026, years ahead of previous plans. Canada is also trying to reduce its overreliance on U.S. military equipment, signaling that its next big purchase of fighter jets will be from European rather than U.S. suppliers.<\/p>\n

Indeed, Carney has spent much of his time in office shoring up relations with Europe on both defense and trade. Since taking office, he has made five multi-day trips to Europe and only one brief visit to Washington. Carney\u2019s enthusiastic support for Ukraine\u2019s fight against Russia has distanced him further from Trump. Canada also signed a \u201cSecurity and Defen<\/a>c<\/a>e Partnership<\/a>\u201d with Europe in June that could eventually lead to much deeper integration in European security arrangements.<\/p>\n

Tougher decisions lie ahead. As part of the U.S.-Mexico-Canada Agreement (USMCA), Canada had increasingly aligned its China policy with the United States. This includes emulating the United States\u2019 100 percent tariffs<\/a> on Chinese-made electric vehicles. China has retaliated with prohibitive tariffs<\/a> on Canadian canola, one of the country\u2019s most valuable agricultural exports. At some point soon, Canada will need to decide<\/a> [PDF] whether to continue embracing the U.S. hard line on China or soften its approach to help fill the void left by the United States.<\/p>\n

Despite these moves, Carney has still made concessions to Trump. He removed<\/a> a tax on digital services on companies like Meta and Google that faced bipartisan criticism in Washington. On September 1, he lifted<\/a> most of the retaliatory tariffs levied by Canada, leaving only those on aluminum and steel. While Canada has not reached a new trade agreement with the Trump administration, it is trying hard to leave room for negotiation, perhaps with an eye toward the 2026 <\/a>review<\/a> of the USMCA.<\/p>\n

But Carney\u2019s balanced approach could run up against fierce anti-Americanism in Canada. Canadians, it seems, were willing to forgive Americans once for electing Donald Trump\u2014but not a second time. Travel to the United States has plummeted<\/a>, and many Canadians have been boycotting American products<\/a>.<\/p>\n

Canada\u2019s strategic realignment will require time to gradually reduce its economic and military dependence on the United States and foster new relationships in Europe and Asia. Slower economic growth is likely for several years at least. Carney has so far had strong public support in his efforts to deal with what he called last week \u201cnot a transition [but] a rupture\u201d in Canada\u2019s relationship with the United States\u2014but he may not get all the time he needs.<\/p>\n

This work represents the views and opinions solely of the author. The Council on Foreign Relations is an independent, nonpartisan membership organization, think tank, and publisher, and takes no institutional positions on matters of policy.<\/p>\n","protected":false},"excerpt":{"rendered":"This piece is part of a joint CFR analysis assessing the geopolitical effect of the Trump administration\u2019s tariffs…\n","protected":false},"author":2,"featured_media":56199,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[174],"tags":[79,995,179,18,40677,19,17,40678,1255,3429,384],"class_list":{"0":"post-56198","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-canada","10":"tag-economy","11":"tag-eire","12":"tag-greenberg-center-for-geoeconomic-studies","13":"tag-ie","14":"tag-ireland","15":"tag-realecon","16":"tag-tariffs","17":"tag-trade-war","18":"tag-united-states"},"share_on_mastodon":{"url":"","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/56198","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=56198"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/56198\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/56199"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=56198"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=56198"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=56198"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}