Prime Minister Mark Carney’s speech in Davos is being seen as “political noise” by U.S. President Donald Trump, U.S. Commerce Secretary Howard Lutnick said in an interview.
In an interview with Bloomberg on the sidelines of the World Economic Forum in Davos, Switzerland, Lutnick said Carney’s positioning and trade deal with China would jeopardize the renegotiation of the Canada-U.S.-Mexico Free Trade Agreement, known as the USMCA in the U.S. and CUSMA in Canada.
“The Canadians have the second-best deal in the whole wide world,” Lutnick said.
Canada does not have a federal election scheduled until 2029 but Carney is in a minority government, which means the government requires a handful of votes from members of other parties in order to pass legislation and survive confidence votes. Losing a confidence vote could trigger an election at any time.
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Lutnick criticized Canada for signing a trade agreement with China, a deal Trump has previously described as a “good thing.”
If Canada continues on the “political path” of closer economic ties with China, “then when USMCA gets renegotiated this year, in the middle of summer, do you think the president of the United States is going to say, ‘You should keep having the second-best deal in the world?’” Lutnick said.
He added that Carney’s speech was “marketing” but may end up hurting Canada’s long-term economic interests.
“Maybe they’re marketing it well, just for their politics. But they’re surely not marketing it well for their fundamental economics for long term with the United States of America,” he added.
U.S. Trade Representative Jamieson Greer said he wasn’t “terribly concerned” about relations with a “middle power” like Canada.
“History does not swing on the hinges of Canada’s geopolitical decisions,” Greer said in a Bloomberg interview.
“They’re always going to have to have a constructive relationship with us.”
The deal signed with Beijing this month reverses course on 100 per cent tariffs Canada slapped on Chinese electric vehicles in 2024, which had aligned with similar U.S. duties and now lowers them to 6.1 per cent while allowing in 49,000 of those vehicles per year.
Canada and China also agreed to reduce tariffs on canola and other products.
Asked about the deal by reporters at the White House, Trump said Carney was doing the right thing.
“That’s what he should be doing. It’s a good thing for him to sign a trade deal. If you can get a deal with China, you should do that,” Trump said.
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