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Trump threatens tariffs on Canadian cars while announcing new Mexico trade agreement

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Eric Zimmer Aug 27, 2018 1:48 pm 3,666

Calling it a “big day for trade,” and his country, President Donald Trump announced on Monday that the US and Mexico had reached a preliminary trade deal as part of an overhaul of the North America Free Trade Agreement (NAFTA).

That preliminary deal doesn’t include any mention of Canada, but the role of America’s northern neighbour in a new trade deal was a topic of discussion during a telephone conversation between Trump and Mexico’s president, Enrique Pena Nieto.

The conversation was held in the White House in front of White House officials and reporters on Monday, with Nieto on speakerphone.

Speaking about the agreement, Nieto said it’s his country’s wish that “Canada will also be able to be incorporated in all this.”

Trump responded that “we haven’t started with Canada yet,” but that negotiations would be starting shortly.

“They [Canada] have tariffs of almost 300% on some of our dairy products – you know we can’t have that, we’re not going to stand for that,” said Trump.

“I think with Canada, frankly, the easiest thing we can do is to tariff their cars coming in; it’s a tremendous amount of money and it’s a very simple negotiation,” he said. “It could end in one day, and we’d take in a lot of money the following day.”

Trump said that one way or another, the US would soon have a new deal with Canada.

“It will either be a tariff on cars, or it will be a negotiated deal,” he said. “And, frankly, a tariff on cars is a much easier way to go.  But perhaps the other would be much better for Canada.”

Chance for a “separate deal”

Speaking about the new deal with Mexico, as well as the potential for a new agreement between the US and Canada, Trump said his government will give Canada a chance “to have a separate deal; we’ll probably have a separate deal and we’ll put it into this deal.”

Trump offered no further details on just what such a deal would look like, other than to reiterate that “we will see whether or not we decide to put up Canada or just do a separate deal with Canada – if they want to make the deal.”

The simplest deal, he added, “is more or less already done.”

Threat “extremely concerning”

In response, Canada’s Economic Development Minister Jim Wilson said in a statement that with “hundreds” of jobs at stake, “it is imperative that our country has a voice at the table and that a deal on NAFTA is reached.”

The threat of auto tariffs on Canadian manufactured cars is “extremely concerning,” he added, particularly to Ontario, where one-in-five Ontario jobs depend on Canada-US trade and investment.

A spokesperson for Canada’s Foreign Affairs Minister Chrystia Freeland told Daily Hive that Freeland will be travelling to Washington DC, tomorrow “to continue negotiations.”

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Eric Zimmer
Staff Writer at Daily Hive.

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