A former high-ranking Canadian trade negotiator, Tim Sargent, predicts that a deal between the Trump administration and Canada regarding tariffs on steel and aluminum exports is imminent. Sargent, who served as Ottawa’s deputy minister of international trade during the negotiations of the Canada-U.S.-Mexico Agreement (CUSMA), highlighted a renewed urgency in discussions following a meeting between Trump and Prime Minister Mark Carney at the White House.
During a panel discussion at the Center for Strategic and International Studies in Washington, Sargent emphasized the economic benefit for both countries to reach an agreement swiftly. He suggested that a potential agreement might involve a tariff-rate quota, allowing a specific amount of Canadian steel into the U.S. annually with minimal tariffs, while imposing higher tariffs on imports exceeding the quota.
The Trump administration has faced opposition from American manufacturers regarding tariffs on Canadian goods, as these tariffs impact their competitiveness with foreign imports. Since June, the U.S. has imposed a 50% tariff on steel and aluminum imports from Canada and other countries globally.
Following the meeting between Trump and Carney on October 7, Trade Minister Dominic LeBlanc disclosed that Trump directed top trade officials to expedite deals on steel, aluminum, and energy. Speculation suggests a possible agreement signing between Trump and Carney at the upcoming Asia-Pacific Economic Cooperation (APEC) summit.
While Sargent remains optimistic about a swift resolution on steel and aluminum tariffs, he expresses doubts about achieving a comprehensive free-trade deal amid the protectionist stance of the current administration. He highlighted concerns about the renegotiation of CUSMA potentially weakening the agreement.
Philip Luck, a former deputy chief economist at the U.S. State Department, emphasized that Canada and Mexico may gain relief from tariffs by redirecting the administration’s focus towards China’s impact on the U.S. economy. The outcome of North American trade negotiations will hinge on balancing domestic production priorities and limiting exposure to economies like China.