Donald Trump expressed approval of Prime Minister Mark Carney’s recent trade deal with China, stating that it was a logical move. Trump made these remarks at the White House, emphasizing the significance of securing trade agreements with China.
The negotiation process leading to the deal between Carney and China was anticipated, with discussions on the agreement’s framework ongoing for over a year. The challenge for Carney was to craft a deal that would be acceptable politically, without alienating the auto industry or Ontario Premier Doug Ford.
The agreement permits the entry of 49,000 electric vehicles (EVs) into Canada initially, accounting for approximately three percent of all vehicle sales in the country. Moreover, it reduces tariffs on canola products but does not eliminate them entirely. Market strategist Jim Thorne believes the deal does not violate any red lines set by the U.S. administration and sees it as a test of boundaries.
The deal has been portrayed by some American media outlets as a shift away from the U.S., indicating Canada’s attempt to diversify amid strained relations with its neighbor. However, Thorne suggests that Trump should view the Canada-China agreement as a valuable benchmark rather than a provocation.
While U.S. officials, including Trade Representative Jamieson Greer and Transportation Secretary Sean Duffy, expressed concerns about the deal’s impact on Canada, they do not anticipate any significant disruptions in Canada-U.S. relations. Greer emphasized that the Chinese cars would remain in Canada and not enter the U.S. market.
Market strategist Karl Schamotta believes Carney’s team navigated potential U.S. backlash by sidestepping contentious issues. He speculates that the agreement might have received tacit approval from the U.S. administration through informal channels.
As reactions unfold, it remains to be seen how the Trump administration will respond to the deal. Observers like Goldy Hyder are curious if the U.S. will draw insights from the Canada-China agreement for their own trade negotiations. Hyder hints at the possibility of the U.S. also seeking a similar deal on automobiles following Trump’s visit to China.