Canada maintains that its efforts to evade American tariffs on steel and aluminum, and threatened tariffs on cars, are on a “separate track” from the ongoing NAFTA talks.
But that’s not how U.S. President Donald Trump sees it. His attempts to use tariffs as leverage in NAFTA negotiations have become such a ingrained habit by this point, he’s started using the word as a verb.
“If countries will not make fair deals with us, they will be ‘Tariffed!'” he tweeted Monday.
China was in Trump’s sights at the start of the week — but by week’s end he also could be talking about Canada and his threat to impose “national security” tariffs of 20 to 25 per cent on its auto industry if it doesn’t soon join the new North American trade deal Americans sketched out with Mexico last month.
One of Trump’s loyal Congressional soldiers, House Majority Whip Steve Scalise, warned Tuesday that Congress would “consider its options” if Canada doesn’t sign on.
Foreign Affairs Minister Chrystia Freeland insists Canada won’t sign a bad deal.
“That’s not rhetoric,” she told reporters before she left again for Washington. Still, she said, Canadians have a “talent for compromise.”
I don’t think we’re going to get a NAFTA deal any time soon.– Monica de Bolle, senior fellow at Washington’s Peterson Institute for International Economics
Her negotiators face a tough call. Even if they strike deals and close the remaining chapters — by Thursday, Freeland’s Mexican counterpart suggested, if they’re going to have a text for Congress by the end of the month — a bigger question lurks.
Would a renegotiated NAFTA lift damaging steel and aluminum tariffs and shut down threats of future car tariffs? If it didn’t, why would Canada sign on?
Monica de Bolle, a senior fellow at Washington’s Peterson Institute for International Economics, said people have been too focused on specific sticking points — dairy concessions, dispute resolution chapters, intellectual property demands and more.
“The big picture is the threat of tariffs,” she said. “And not just the threat. The ones already in place.”