Latest news with #Canada-UnitedStates-MexicoAgreement
Global News
3 days ago
- Business
- Global News
Carney set for affordability announcement as next U.S. tariff date looms
Prime Minister Mark Carney is set to make an announcement on affordability in Prince Edward Island on Monday as the date for Canada to reach a trade deal with the U.S. looms. The Prime Minister's Office says in Carney's itinerary he will be announcing new measures to lower costs for Canadians. He will then take questions from reporters following the announcement. Get breaking National news For news impacting Canada and around the world, sign up for breaking news alerts delivered directly to you when they happen. Sign up for breaking National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy The announcement comes just four days before U.S. President Donald Trump's Aug. 1 deadline for countries around the world to reach a trade deal with his administration. Trump threatened Canada with a 35 per cent tariff on all goods not exempted by the Canada-United States-Mexico Agreement (CUSMA) starting Aug. 1 if a deal isn't reached. However, 25 per cent tariffs remain on steel and aluminum exports to the U.S., as well as 25 per cent on the automotive industry. Copper duties are also expected to take place later this week. Story continues below advertisement The president has not said if the Aug. 1 deadline will have any impact on those tariffs. More to come.
Global News
24-07-2025
- Business
- Global News
Why Canada's supply management is a sticking point for Trump in trade talks
The target date for a new trade deal between Canada and the United States is a little over a week away, but one issue continues to be a sticking point between both nations: Canada's supply management. Supply management, which Canada uses in the dairy, poultry and egg sectors, has been a frequent target of criticism from U.S. President Donald Trump throughout his threats of tariffs and claims that Canada is 'ripping us off.' Last month, while demanding Canada repeal its digital services tax, Trump said Canada was 'a very difficult Country to TRADE with,' claiming on his social media platform Truth Social that the country charges 'tariffs' of up to 400 per cent on dairy products. Canada uses a quota system that allows a set amount of some foreign dairy products into the country, and high tariffs only apply if countries try to exceed that allowed quota coming into Canada. Story continues below advertisement Canada's supply management system, which dates back to the 1970s, has restricted foreign access to the Canadian dairy market in order to protect domestic producers and set quality standards for products. Prime Minister Mark Carney vowed in the Liberal election platform that he will 'keep Canada's supply management off the table in any negotiations with the U.S.' So how does it work? What is supply management? The Canada-United States-Mexico Agreement (CUSMA) — which Trump re-negotiated to replace the North American Free Trade Agreement (NAFTA) during his first term — narrowly expanded U.S. access to Canada's dairy market, which is protected under supply management rules. The rules, established in the 1970s, set production quotas for Canadian farmers, guarantee minimum prices, and maintain import and quality controls. Story continues below advertisement 'Producers have a licence to produce that's determined by their quota. Producers will only produce as much as the quota says they are allowed to produce or in fact to sell,' said Sven Anders, a resource economist at the University of Alberta. Get breaking National news For news impacting Canada and around the world, sign up for breaking news alerts delivered directly to you when they happen. Sign up for breaking National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy Under CUSMA, the U.S. gets access to less than five per cent of the market. But the U.S. has launched multiple disputes claiming Canada is intentionally bottlenecking those U.S. imports through tariff rate quotas, which put limits on how many exporters qualify for the cheaper duties. The issue of supply management for farmers might end up being an issue both sides are unwilling to move on. For one, most Canadian politicians are staunchly in support of the policy. 'We saw during the leaders' debate that all of the leaders, specifically in French, said that supply management was a red line in any negotiations with the Trump administration over tariffs,' said Moshe Lander, an economist at Concordia University. 'It seems that they were willing to even accept tariffs and damage to the Canadian economy rather than put dairy and supply management on the table.' The policy is aimed at protecting Canadian dairy farmers from the much larger American dairy industry and keeping prices and supplies stable by controlling the amount of product available. Story continues below advertisement Anders said Canadian politicians are reluctant to alienate dairy farmers. 'They have a lot of political clout. So, if I was a politician in Ontario or Quebec, among my constituents would be many dairy farmers. I certainly would want to fight for them,' he said. That political influence is particularly strong in Quebec, one expert said. 'In 17 ridings provincially in Quebec, people under supply management are strong enough to change the outcome of the election,' said Vincent Geloso, senior economist at the Montreal Economic Institute. 'Having influence over 17 ridings makes you a very powerful interest group.' As Canada's premiers were meeting for a three-day summit in Ontario, Quebec Premier François Legault said supply management was a hard line in the U.S. trade negotiations for him. 'There's no question about negotiating the supply management for dairy and other products,' Legault told reporters. Lander said supporters of Canada's dairy industry see the policy as necessary to protect them from the much larger American dairy industry. 'Wisconsin alone produces more milk than Canada consumes in a year,' he said. He said small Canadian dairy farms would be unable to withstand the pressure of open competition from the U.S. Story continues below advertisement 'These farms would have to merge their way up into these mega farms like you see in Wisconsin or in Minnesota to try and remain competitive. That would push a lot of farmers off their traditional land,' he said. Dairy Farmers of Canada declined Global's request for comment. 1:51 U.S. may be looking to remove non-tariff barriers, report shows However, Trump and the Republicans have their own political calculus in pushing Canada on supply management, he said. 'In the midterm elections, which are next year, maintaining Wisconsin is going to be very important for the Republicans if they want to maintain control of the House (of Representatives). If you vocally support farmers, this is one way to maybe keep that base solidified,' he said. One prominent Canadian voice who is opposed to the present system of supply management is Alberta Premier Danielle Smith, who said recently that she was considering 'creating our own Alberta version of supply and management, maybe as a pathway to a market system.' Story continues below advertisement 'We do not get our share of quota, I think we have 12 per cent of the population and we only get seven per cent of the quota,' she told reporters last week. One consequence of supply management is that Canadians end up paying more for dairy products, Anders said. 'There's plenty of research that says or that has documented that an average Canadian household pays several hundred dollars more in food in dairy product cost on an annual basis just because of supply management,' he said. However, the same system has also been credited with helping Canadian consumers avoid the price shocks seen by U.S. consumers over the past year, as egg prices south of the border soared. Trump's criticisms aren't historically abnormal for U.S. presidents, either. 'Biden and Obama both had objections to it and voiced it,' Lander said. 'The more I say I dislike it, and the more you insist you're not going to remove it, then the more that I can say I want my way on these other things. It could be that he (Trump) just sees it as a tactic, where the Democratic presidents who had opposed it in the past merely just saw it as an annoyance.' — with files from Global's Sean Boynton and Touria Izri
Calgary Herald
23-07-2025
- Automotive
- Calgary Herald
Japanese trade deal with U.S. creates lower tariff rate for vehicles than Canada faces
Article content A new U.S.-Japan trade deal reportedly gives the Asian country a 15 per cent flat tariff rate — providing a potential edge in key export areas such as auto manufacturing, where Canadian finished vehicles currently face a 25 per cent tariff rate. Article content United States President Donald Trump announced the deal with Japan on Tuesday but details remain vague, as no official text of the deal was released. Article content Article content Article content That is similar to other trade deals that the U.S. has announced in recent weeks, where the details remain undisclosed. Still, as Canada inches toward an August deadline on negotiations with the U.S., auto industry professionals offered mixed reactions as to how Japan's deal could affect the competitiveness of Canada's sector. Article content Article content 'If you're Japan, and you're looking around and saying where are my competitors, you're feeling pretty good,' said Eric Miller, president of Washington, D.C.-based Rideau Potomac Strategy Group, a consulting firm on trade policy. 'Autos are about a quarter of their exports, and the auto access was a significant piece of this.' Article content Indeed, according to the World Bank, auto and related exports accounted for about 20 per cent of Japan's trade in 2022. Article content Within Canada's auto sector, the agreement spurred mixed reactions. Article content Article content On the one hand, if Japanese-built vehicle exports to the U.S. face a lower duty than Canadian built ones, this could in theory incentivize some automakers to move production to Japan. Article content Article content On the other hand, that is considered unlikely by many within the auto industry who hold out hope that in the end, Canadian-built autos are likely to receive a lower tariff rate than Japan. Article content 'That's certainly the hope,' said David Adams, president of the Global Automakers of Canada, a lobbying group that represents Honda Motor Co. Ltd. and Toyota Motor Corp. among other foreign automakers. Article content He and others say that vehicles built in Canada, often in border towns such as Windsor, have far more spillover effects in terms of creating jobs in the U.S. than vehicles built in other countries that are separated from the U.S. by an ocean. Article content In reality, Canadian automakers are already paying below 15 per cent in many cases. That is because the Trump Administration adjusted its policies such that automakers can declare the value of any Canada-United States-Mexico Agreement (CUSMA) compliant parts contained within a vehicle and deduct that amount from the total value of the vehicle subject to a tariff.
Yahoo
23-07-2025
- Automotive
- Yahoo
Automakers say tariffs are costing them billions and warn of steeper losses ahead
Two automakers with manufacturing operations in Canada, General Motors Co. and Stellantis NV, reported this week that tariffs are taking billions of dollars out of their profits. On Tuesday, GM said tariffs had a net impact of about $1.5 billion on its second-quarter earnings before interest and taxes (EBIT). One day earlier, Stellantis, which produces Fiat and Chrysler vehicles, reported that tariffs exacted a hit of about $477 million through the first half of the year, but warned of steeper losses ahead. Since the tariffs took effect earlier this year, automakers in North America have been warning that tariffs will add costs and make them less competitive at a time when they are navigating a complex transition to electric vehicles. One end result may be less vehicle production in Canada. 'These earnings reports from automakers underline the reasons why we urgently need to get to a deal (with the U.S.) that removes tariffs,' said Brian Kingston, president of the Canadian Vehicle Manufacturers' Association (CVMA), a trade industry lobby group that represents both GM and Stellantis. Beginning in March, when the U.S. briefly imposed blanket 25 per cent tariffs on Canadian goods, and then resuming in April, when the U.S. imposed a 25 per cent tariff specifically on all vehicle imports, auto exports to the U.S. have faced a 25 per cent tariff. The U.S. ultimately adjusted its policy such that vehicles compliant with the Canada-United States-Mexico Agreement (CUSMA) could mitigate the tariff rate based on the percentage of U.S.-built parts contained in a vehicle. At the same time, in April, Canada applied its own 25 per cent counter-tariffs to U.S.-built vehicles. Taken together, the policies are forcing North America's automakers to overhaul their operations so that more vehicles are built in the market where they are sold. That is proving to be an expensive proposition for an industry that spent the past two decades operating under free trade agreements that incentivized global supply chains, under which vehicles cross borders multiple times before being delivered to their end markets. Prime Minister Mark Carney has said he is aiming for a comprehensive trade deal by early August, but also has said there is likely to be some baseline level of tariffs on exports to the U.S. Overall, the uncertainty is already having an impact on Canada's auto sector. GM, for example, has said it plans this fall to cut the third shift at its Oshawa, Ont., plant — expected to cause about 700 layoffs — where it makes light duty and heavy duty Chevy Silverado pickup trucks. At the same time, it has added a shift in Indiana where it also makes the trucks. In addition to the impacts of layoffs on Canadian workers, the move could have another effect: Canada created a 'duty remission' scheme that allowed automakers to import vehicles from the U.S. duty free, based on the number of vehicles produced here. The shift change could reduce GM's production in Canada by one-third. Jennifer Wright, a GM spokesperson, said the federal government is well aware of the impending shift reduction, but could not say how it would affect its duty remission allowance, not least because Carney is hoping to reach a trade agreement before that. The situation shows how automakers are seeking to reconfigure cross-border operations to mitigate their tariff exposure. Wright noted that in 2024, GM sold 294,000 vehicles in Canada, which were produced in South Korea, Mexico, the U.S., and Canada. Now, tariffs create incentives to disentangle global supply chains. 'The auto sector has been designed in the last few years to be a very integrated market,' said Wright. GM said on its earnings call on Thursday that it expects tariffs to take US$4 billion to US$5 billion out of its earnings for 2025. So far, the company has posted strong sales in Canada in 2025, showing an eight per cent year-over-year increase in the second quarter. But Wright also said sales surged before tariffs took effect and she expects to see a softening as the year progresses. Meanwhile, Stellantis earlier this year indefinitely paused a multibillion dollar overhaul of its assembly plant in Brampton, Ont., which was being retooled so it could produce battery-electric, hybrid or internal combustion engine Jeeps, depending on market demand. At its Windsor, Ont., plant, the company continues to produce hybrid and internal combustion engine Chrysler Pacifica minivans, and battery-electric Dodge Chargers, but it has temporarily paused operations twice this year since tariffs were announced. Earlier this year, the company estimated that tariffs could cost it more than $2 billion. But the company is also battling sluggish sales, and shipments within North America fell 25 per cent in the first quarter of the year. GM to cut shifts at Oshawa Assembly Plant in move union calls 'reckless' How Trump's tariffs are already hobbling Canada's auto sector Kingston, of the CVMA, said that overall he expects vehicle sales in all of North America to drop by roughly 10 per cent in 2025. Although Carney has set an Aug. 1 deadline for a trade deal, Kingston called it an 'optimistic scenario.' Nonetheless, he said it is vital to the health of his industry to resolve the trade war quickly. 'The U.S. trade policy is doing significant damage to American automakers,' Kingston said. 'We need a resolution and we need it quickly.' • Email: gfriedman@ Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Ottawa Citizen
21-07-2025
- Politics
- Ottawa Citizen
How John Hannaford led the public service through transition and turmoil
If John Hannaford had a superpower, it might have been his ability to help a team reach consensus. Article content Rather than rule with an iron fist, he would engage in what former colleagues called 'deep listening.' Article content Recommended Videos Article content 'He really was thoughtful about that, and I think purposeful, right?' said Marta Morgan, a former colleague of Hannaford and retired public service executive. 'He wanted to pull out the best in people, and one way of doing that is making people know that they're heard and they're part of the discussion.' Article content Article content Morgan recalled that when Hannaford led meetings, he would prioritize listening and ensure that everyone in the room was given a chance to share their thoughts. Article content Former colleagues have said those listening skills served him well in his career as he navigated turbulent times. Hannaford retired in early July as his successor, Michael Sabia, took the reins of the federal public service. Article content Before he became clerk of the Privy Council, Hannaford was deputy minister at Natural Resources. In that role, Hannaford led a team of government executives on a tour of Western Canada when that part of the country was feeling particularly alienated from the federal government in Ottawa. Article content Daniel Quan-Watson, another former colleague and retired public service executive, said the tour embodied Hannaford's 'commitment to listening and genuine interest and fascination.' Article content Article content 'I think it's such an important signal of Canada's public service, being there, even in difficult places, difficult listening, difficult conversations and being present for people,' Quan-Watson added. Article content Article content Hannaford would perhaps agree, having said in a 'fireside chat' with the Canada School of Public Service that he 'didn't have that objective' in his career planning. Article content But he was trusted by then-prime minister Justin Trudeau, having served as a PCO advisor on foreign affairs and defence from 2015 to 2019. He also served as deputy minister of international trade, where he was involved in renegotiating NAFTA, which then became the Canada-United States-Mexico Agreement.
