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Can Canada wait out the trade war with the US?

Canada’s Prime Minister Mark Carney is demonstrating a calculated patience in the ongoing trade dispute with the United States, asserting that he will resume discussions with President Donald Trump only when critical issues arise. This strategic shift reflects Canada’s approach to escalating tariffs and political tensions, as Carney faces criticism for his apparent lack of urgency in addressing economic concerns.

Prime Minister Carney recently dismissed inquiries about the timing of his last communication with President Trump, stating, “Who cares? It’s a detail. I’ll speak to him again when it matters.” He emphasized that there is no “burning issue” requiring immediate dialogue, a stance that has drawn criticism from opponents who accuse him of neglecting urgent economic matters. This nonchalant attitude suggests a deliberate strategy to avoid appearing desperate in negotiations, as both leaders engage in a battle of wills over trade terms. Carney’s comments came during a weekend press engagement, where he downplayed the significance of frequent contact, highlighting instead the substance of future talks.

Trade talks between the two nations stalled last month after Trump took offense at an anti-tariff advertisement commissioned by Ontario, featuring former President Ronald Reagan warning that tariffs “hurt every American.” The ad, which aired in the US, prompted Trump to halt discussions, despite previous regular text exchanges between the leaders. Carney had earlier described these texts as filled with “a lot of caps and exclamation marks” and operating on a “24/7” basis, indicating a once-fluid communication channel that has now frozen. This interruption underscores the fragility of diplomatic relations in the face of provocative messaging.

The economic stakes are high for Canada, with approximately 75% of its exports destined for the US market, making it highly vulnerable to American tariff policies. The US has imposed a 35% levy on all Canadian goods, though most are exempt under the existing free trade agreement, and additional sector-specific tariffs include 50% on metals and 25% on automobiles. These measures have sparked concerns about job losses and economic strain, particularly in provinces like Manitoba, where heavy machinery industries are feeling the pinch. Despite this, Carney has noted that Canada faces lower tariffs than other countries due to exemptions, providing some buffer.

In response, the Carney government has signaled plans to offer financial relief to sectors hardest hit by the tariffs, such as aluminium producers who have absorbed initial costs to meet US contractual obligations. Jean Simard, head of the Aluminium Association of Canada, argued that “time is on our side and pain is on their side,” citing US dependence on imported aluminium as a leverage point. However, pressure mounts from other quarters, including opposition Conservatives who criticize Carney for downplaying job losses and failing to deliver on campaign promises of a trade “win.”

The political landscape in the US adds complexity, with midterm elections approaching next year and many Congress members in campaign mode. A November Fox News poll revealed that 76% of US voters view the economy negatively, up from July, and many blame Trump’s policies for their financial woes. Trump has recently rolled back tariffs on dozens of food items and indicated openness to reducing metals tariffs if production shifts to the US, suggesting potential flexibility. Chris Sands of Johns Hopkins University noted that both sides are posturing to avoid looking needy, but business interests may push for a resolution.

Looking ahead, Carney is considering a trip to Washington for the FIFA World Cup draw next week, where an informal meeting with Trump could occur, though nothing is confirmed. Additionally, the US Trade Representative will hold public hearings in early December on the USMCA free trade agreement, set for review in 2026, which could reignite negotiations. Sands believes that private sector advocacy for continued free trade might create an opportunity for Carney to re-engage, framing it as a response to business demands. Ultimately, while Canada waits, the outcome hinges on evolving political and economic pressures in both nations.

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