As U.S. President Donald Trump pushes forward with his aggressive global trade agenda, Canada has managed to sidestep the immediate impact of his looming tariff deadline. While Trump announced that letters have been sent to multiple governments warning of steep new tariffs unless trade deals are finalized, Canada is notably absent from the list of countries affected by the Wednesday cutoff.
The president has been escalating pressure through his “Liberation Day” duties—a series of tariffs intended to force trade negotiations. Despite warning of potentially harsh penalties, Trump acknowledged that some agreements have already been made and others are in progress. So far, only framework deals with the United Kingdom and Vietnam have been outlined.
Trump’s 90-day deadline for finalizing trade arrangements has produced little in terms of concrete agreements, prompting speculation over which countries will face increased tariffs beginning August 1. U.S. Commerce Secretary Howard Lutnick confirmed that nations failing to secure a deal by then will be hit with elevated duties, though he noted that negotiations could continue right up to that point.
Canada, while not part of the group facing the broader tariff threat, is still subject to targeted trade actions. A 25% tariff on fentanyl-related products, along with a 10% levy on Canadian energy and potash exports, remains in place for goods not compliant with the Canada-U.S.-Mexico Agreement (CUSMA). Additionally, long-standing tariffs on Canadian steel, aluminum, and automobile exports continue to weigh on trade relations.
Despite this, Canada and the U.S. are actively working on a broader bilateral economic and security partnership. Prime Minister Mark Carney and President Trump agreed in March to aim for a new deal by July 21, and negotiations have been ongoing since Carney’s White House visit in early May. Talks briefly stalled in June after Trump demanded the removal of Canada’s digital services tax—a request Ottawa conceded to just before the tax was set to take effect.
Observers are closely watching how Trump’s administration proceeds with trade deals elsewhere, as it could signal his strategic priorities before the July 21 deadline for Canada. Treasury Secretary Scott Bessent said new announcements are expected within 48 hours, emphasizing that Trump’s focus is on achieving “quality deals” rather than rushing to secure numerous ones.
As global markets brace for potential fallout from a fresh wave of tariffs, Canada appears to be walking a diplomatic tightrope—one that could determine the future of its trade relationship with the United States.
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