Carney's top aide joins Canada-U.S. trade talks in Washington

Globe and Mail

30-07-2025

Prime Minister Mark Carney's top aide has joined Canada-U.S. negotiations in Washington as the two countries try to strike a deal to end a five-month trade war.
The Prime Minister's Office said Marc-André Blanchard, chief of staff to Mr. Carney, has headed to the U.S. Capitol with officials including Intergovernmental Affairs Minister Dominic LeBlanc who has travelled there to talk with members of Donald Trump's administration.
It's the third time in recent weeks that Mr. Blanchard has joined the trade talks in Washington.
Mr. Trump has threatened to raise tariffs on Canadian goods to 35 per cent from 25 per cent Aug. 1 if a deal is not reached.
Both he and Mr. Carney have signaled that a deal by Aug. 1 may not be possible.
Since returning to office earlier this year, Mr. Trump has hit Canada with a string of tariffs: 50 per cent on steel and aluminum; 25 per cent on autos; and 25 per cent on any goods traded outside the United States-Mexico-Canada Agreement (USMCA, with the exception of oil, gas and potash, at 10 per cent.
On Sunday, the European Union became the latest U.S. trade partner to reach an agreement with Mr. Trump that locks them into higher tariffs in order to avoid worse threats from the protectionist President.
The EU accepted a broad-based 15-per-cent tariff, with carve-outs for certain industries, and agreed to purchase US$750-billion worth of U.S. energy and invest around US$600-billion in the United States. The agreement left tariffs of 50 per cent in place on steel and aluminum – although EU officials suggested there may be quotas that lower the tariff rate on the metals.
Politicians, companies and investors in Canada have been watching the progress of the EU deal closely as a bellwether for a possible U.S. agreement with Canada. Like Japan – which agreed to a 15-per-cent baseline U.S. tariff last week – the EU is a major U.S. ally and significant trading partner.
The EU's trade deal with the U.S. isn't a blueprint for Canada, Carney says
Asked about the EU deal on Monday, Mr. Carney reiterated that Canada will likely face some level of U.S. tariffs going forward, even if Ottawa and Washington can strike a deal, either before or after the Aug. 1 deadline set by Mr. Trump.
But he said that Canada is in a different position than other U.S. trading partners as it enters an 'intense phase' of negotiations.
'There are similarities. There are differences. One is geographic proximity,' Mr. Carney told reporters at a press conference in Prince Edward Island.
The deal with the EU is the sixth trade agreement Mr. Trump has reached in recent months as he has sought to remake the global trading system with the highest tariffs since the 1930s. He has also made deals with Britain, Japan, Indonesia, Vietnam and the Philippines.
All the agreements left baseline U.S. tariffs in place, ranging from 10 per cent to 20 per cent – a far higher level of tariffs than at the start of the year, but lower than Mr. Trump had threatened. Sectoral tariffs were also left in place, although they were diluted in some cases, with both Japan and the EU securing 15-per-cent auto tariffs, rather than the 25 per cent applied to other countries.
Opinion: Canada must avoid rushing into trade shakedown
Some details remain unclear as these are not formal trade agreements, but rather handshake deals.
As these deals have rolled out, Canada remains in a relatively privileged position when it comes to access to the U.S. market.
As with every other country, it has been hit with industry-specific tariffs on steel, aluminum and automobiles. But the blanket 25-per-cent tariff that Mr. Trump imposed on Canadian goods back in March has been watered down by an exemption for all goods that comply with rules of origin in the United States-Mexico-Canada Agreement, the continental free-trade pact sometimes known in Canada as CUSMA.
That has allowed the vast majority of Canadian exports to continue entering the U.S. tariff-free. In May, 90 per cent of Canadian goods entered the U.S. without paying duties, according to U.S. Census Bureau data, through some combination of USMCA exemption and other tariff-mitigation strategies.
With reports from Mark Rendell