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Prime Minister Mark Carney said Thursday that Canada’s old relationship with the United States was “over” and vowed there would be a “broad renegotiation” of the trade agreement between the countries.
Speaking to Ottawa after meeting the country’s provincial prime ministers, Carney said the tariffs set by US President Donald Trump would force Canada to rethink and reformulate its economy and seek “credible” partners.
“The old relationship we have had with the United States, based on deepening the integration of our economies and close security and military cooperation, is over,” he told reporters.
“It will be time for a widespread renegotiation of our security and trade relationship.”
Carney’s comments seem to question the future of USMCA, which was negotiated between the two countries and Mexico during the former Trump administration and has been greeted as one of the most important trading agreements in the world.
Carney said Canada will fight US tariffs with vengeance trade acts “which will have maximum impact on the US and minimum impacts on Canada.”
On Wednesday Trump said the US would impose a 25 percent fee on imports of foreign car in a move he said was intended to strengthen the US industry in the US.
While the ingredients in accordance with USMCA are temporarily exempt from tariffs, the tax can have a major impact on the Canadian economy.
Trump’s tariffs are intended to strengthen the US industry, but shares in General Motors dropped 7.4 percent on Thursday. Shares in Ford, which produces fewer vehicles in Mexico and Canada than its rival, decreased 3.9 percent.
At the beginning of this month, Trump offered a return to Canadian and Mexican car manufacturers when he temporarily excluded all the goods that agreed with USMCA from the new tariffs.
“We will fight again with everything we have to get the best deal for Canada. We will build an independent future for our country, stronger than ever,” Carney said.
The prime minister said the Canadian economy and its supply chains to critical sectors such as the vehicle industry will have to radically change to isolate themselves from further tariffs and US hostility.
“We will have to do some things very different,” he said.
Tiff Macklem, Governor of the Canada Bank, said US tariffs are likely to put Canada in a recession and a “new crisis” was approaching due to commercial war with SH.BA
“Depending on the extent and duration of US tariffs, economic impact can be severe; uncertainty is only causing damage,” he said earlier this month as he announced another decrease in interest rates.
Carney said Canada’s vehicle sector could survive Trump’s tariffs, but would require “access to other markets”, and the place needed to “re -fit the vehicle sector and reconstruction (and) Retool”.
He recently traveled to London and Paris, his first trip as prime minister, in an attempt to increase trade with other partners in the wake of American hostilities.
Carney, who is in the midst of a national election campaign before a vote on April 28, said he would talk to Trump on “the next or two”.
Some members of the Canadian cabinet can also go to Washington to meet their counterparts, he said.
He added that the US president’s fees will “end up with American workers and US consumers.”
