Canada is pushing for a 16-year renewal of its trade agreement with the United States and Mexico, with a critical deadline arriving in July and a U.S. trade representative who has given no guarantees.
Canada-U.S. Trade Minister Dominic LeBlanc sent a formal letter this week to U.S. Trade Representative Jamieson Greer and Mexico's secretary of economy, Marcelo Ebrard, calling for renewal of the Canada-U.S.-Mexico Agreement on trade, known in Canada as CUSMA. The letter is a requirement of the agreement's mandatory review process.
LeBlanc followed the letter with a meeting at the Canadian Embassy in Washington on Tuesday.
"We discussed how we can work together on a number of issues that strengthen the competitiveness of the North American economy," he said.
Barrie's News Delivered To Your Inbox
By submitting this form, you are consenting to receive marketing emails from: Central Ontario Broadcasting, 431 Huronia Rd, Barrie, Ontario, CA, https://www.cobroadcasting.com. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact
What Canada is asking for
The letter made clear that Canada wants all three countries to commit to another 16 years. It also signalled flexibility.
"Canadian, American and Mexican farmers, businesses, workers and consumers are counting on the timely completion of this work to provide the certainty and stability that is essential to maintaining the conditions that not only secure their economic futures but allow them to prosper," the letter read.
Canada said it "is willing to consider any proposal that can be beneficial to all three nations' long-term prosperity."
Mexico made the same ask. Ebrard called for a 16-year renewal at a press conference in Mexico City on the same day. LeBlanc said he received letters from both the U.S. and Mexican sides but would not say what they contained.
Why CUSMA matters right now
The agreement has been shielding Canadian and Mexican exporters from the full weight of U.S. tariffs. The current 10 per cent U.S. global duty does not apply to goods that comply with CUSMA rules.
CUSMA was negotiated during Trump's first term to replace NAFTA. Since returning to office, Trump has called the agreement irrelevant and suggested it may have run its course.
LeBlanc said he raised Trump's separate tariffs on specific Canadian industries during his closed-door talks with Greer, including steel, aluminum, automobiles, lumber and cabinetry.
Three options, one deadline
Each country faces a three-way choice to make in July. They can renew the deal for another 16 years, withdraw from it, or signal both non-renewal and non-withdrawal. That third option would trigger an annual review process that could keep negotiations going for up to a decade.
Experts and industry groups have warned that prolonged uncertainty under that scenario could undermine business investment and confidence.
The U.S. letter to Canada and Mexico has not been made public. Greer's public comments suggest he is unlikely to simply agree to a renewal. He has said he'd be open to two separate bilateral agreements, while acknowledging that parts of CUSMA work well.
LeBlanc stressed that missing the July deadline does not end the agreement, since the annual review process would still be available. But he was clear the Canadian side wants to move quickly.
Canada and U.S. not yet at the table together
Ottawa and Mexico City are aligned on wanting a trilateral deal, and have held their own separate bilateral talks. But Canada and the United States have not yet started formal CUSMA negotiations. Talks between the U.S. and Mexico have already begun.
Trade talks between Ottawa and Washington were frozen last October after Trump objected to an Ontario-funded advertisement quoting former U.S. president Ronald Reagan criticizing tariffs. The relationship thawed in March and LeBlanc said talks have been ongoing since.
Prime Minister Mark Carney told reporters in Ottawa on Tuesday that Washington has distinct sets of issues with Canada and Mexico.
"There's a series of issues, technical issues, that they have with Mexico, they have with us, which is why there's a bifurcated discussion," he said.
Carney said the U.S. has a list of roughly 30 issues with Canada of "varying technicality."
RELATED: Canada's economy is contracting. Carney says his plan is still settling in...
Canada's chief trade negotiator Janice Charette, who joined LeBlanc in Washington, said the Canadian side pressed the U.S. on the value of maintaining the deal. She said they focused on "the stability and the certainty and the predictability that that agreement offers, and the importance of trying to get to there as quickly as possible."
LeBlanc says stay focused on the outcome
LeBlanc acknowledged the talks have not been without friction but pushed back on any suggestion of alarm.
"This trip has not been without some turbulence. We've all been in contexts where there's turbulence -- you don't take your seatbelt off and run up and down the aisle and kick in the cockpit door," he said. "You remain focused on the work that you need to do, and you come through the turbulence very much focused on the outcome."
He said he left Washington feeling optimistic.
* With files from CP
