Concerns are rising among Canadian negotiators that it may not be possible to prevent new U.S. tariffs from being implemented on Wednesday. Ottawa is facing challenges in securing relief from Washington on existing sectoral tariffs while simultaneously working to convince provinces to remove restrictions on American alcohol, according to sources familiar with the matter.
Multiple sources, both in Canada and the U.S., have been briefed on the ongoing negotiations and have been granted confidentiality to discuss the talks candidly.
The negotiations are escalating, with reports from Radio-Canada indicating that Canada-U.S. Trade Minister Dominic LeBlanc is scheduled to meet again with U.S. Trade Representative Jamieson Greer on Sunday. This would mark their third meeting in a week.
In recent weeks, Ottawa has been striving to reach a “comprehensive agreement” with Washington. The objective is for the Trump administration to abandon the impending 50 per cent tariffs on almost $28 billion worth of Canadian goods, representing around five per cent of Canada’s exports to the U.S.
Central to this agreement would be a provision for the Trump administration to reduce existing sectoral tariffs affecting the steel, aluminum, auto, and lumber industries. Presently, steel and aluminum face 50 per cent tariffs, while autos face tariffs of 25 per cent.
Speaking in Des Moines, Iowa, United States Trade Representative Jamieson Greer stated that there are significant trade challenges with Canada, emphasizing that the current situation is not classified as a trade war.
Sources reveal that the pursuit of a comprehensive two-pronged deal is crucial for gaining provincial support for any agreement, including a commitment to reintroduce American alcohol to the market. The Trump administration has made the restoration of U.S. alcohol sales in Canada a non-negotiable aspect of the negotiations, according to sources.
However, the U.S. has not yet shown willingness to substantially reduce existing sectoral tariffs, and disparities persist between the two nations on crucial unresolved issues, as reported by CBC News on Friday.
Several provinces are holding firm on maintaining their bans on American alcohol unless the U.S. provides relief on tariffs affecting their respective industries. Consequently, Ottawa is facing pressure, with concerns arising among negotiators that a finalized deal may be unattainable if provincial opposition persists.
Canada poised to compromise
Sources indicate that provinces and territories have been informed that Canada will need to make concessions on the three
