Trump says USMCA ‘irrelevant’ as Canada attempts reset with China

U.S. President Donald Trump has dismissed the United States-Mexico-Canada trade agreement as “irrelevant” as Prime Minister Mark Carney prepares to visit China, Qatar and Switzerland in an effort to mend economic relations with Beijing.

Trump Downplays USMCA

Speaking at a Ford auto assembly plant in Dearborn, Mich., Trump emphasized his economic agenda amid concerns about affordability and job growth. He stated, “There’s no real advantage to it, it’s irrelevant,” adding that Canada “would love it” and “needs it.”

The comment was a pointed dismissal of the USMCA, an agreement Trump previously negotiated and signed. His statements have caused concern in Canada and Mexico ahead of expected renegotiation talks this year. Dominic LeBlanc, the minister in charge of Canada-U.S. relations, is scheduled to meet with U.S. counterparts in mid-January to begin formal USMCA discussions.

Despite Trump’s comments, the USMCA currently protects most Canadian exports from punitive tariffs imposed by his administration. However, some tariffs remain in place, including levies on non-U.S. content in automobiles assembled in Canada and Mexico. Trump has also stated the U.S. does not need Canadian-built vehicles.

Carney’s Trip and China Tariffs

The uncertainty surrounding Trump’s trade policies is expected to be a factor as Carney arrives in China on Wednesday. Discussions with Chinese officials, including President Xi Jinping, are expected to include Canada’s 100-per-cent tariffs on Chinese electric vehicles, implemented alongside the Biden administration to protect the continental auto industry.

Lifting the tariffs could potentially revive trade with China, which has imposed countertariffs on Canadian agricultural exports, and provide a counterbalance to Trump’s protectionist policies. However, such a move could strain Ottawa’s relationship with Trump and add pressure to Canada’s domestic auto industry.

Chris LaCivita, co-manager of Trump’s 2024 presidential campaign, posted on social media, “Prediction – this won’t end well for Carney,” in response to a report that China seeks to reduce Canada’s reliance on U.S. influence.

Provincial Reactions

Ontario Premier Doug Ford reiterated his opposition to lifting the EV tariffs, stating he had not discussed the issue with Carney prior to his trip. “I’m 100 per-cent dead set against” lifting the tariffs, Ford said.

Saskatchewan Premier Scott Moe, who is accompanying Carney to China, has called for an end to the EV tariffs to encourage China to lift its retaliatory measures on Canadian soy and canola. Ford acknowledged Moe’s need to advocate for his province but emphasized his focus on protecting Ontario’s auto sector.

Ford added that he would be open to easing the EV tariffs if Chinese automakers committed to building plants in Canada and hiring Ontario workers. He plans to contact Carney to voice his concerns and expects a meeting with the Prime Minister upon his return.

A separate dispute has emerged between Ford and Manitoba Premier Wab Kinew regarding a potential ban on Crown Royal whisky from Ontario liquor stores, a move Ford has threatened in response to Diageo PLC’s decision to close a bottling plant in Ontario. Kinew warned that the ban would cost jobs in Gimli, Man., where the liquor is made. Ford stated he was protecting jobs in Ontario and respected Kinew’s position.