Canada’s ambassador to the United States emphasized the necessity of reintroducing American alcohol into Canadian markets during a video conference on Thursday. This step is seen as crucial to finalizing a trade deal with the U.S. and avoiding potential new tariffs, as reported by CBC News sources.
Mark Wiseman, the ambassador, addressed approximately 100 members of the Canada-U.S. trade council, which comprises various businesses, industry groups, and labor organizations. The council also received insights from a former Canadian chief trade negotiator who expressed reservations about the proposed agreement.
In Washington, Canada’s negotiating team is engaged in urgent discussions with the Trump administration to prevent the imposition of 50 percent tariffs on Canadian exports worth billions of dollars before the approaching Friday deadline.
Wiseman shared details of a preliminary agreement to avert the new tariffs during the half-hour briefing, according to sources familiar with the call. The potential deal involves efforts by around 35 Canadian officials based at the Canadian Embassy in Washington to finalize the agreement within 24 to 48 hours.
Key components of the potential deal include reductions in steel, aluminum, and auto tariffs, as well as modifications in the allocation of dairy import licenses by the Canadian government. However, concerns have been raised by the dairy industry regarding the potential influx of American dairy products in the Canadian market.
Following Wiseman’s departure from the call, former chief trade negotiator Steve Verheul cautioned the council about potential downsides of the deal. Verheul highlighted the immediate threat posed by Trump’s Section 338 tariffs and the risk of sacrificing long-term advantages by agreeing to certain concessions.
Verheul emphasized that agreeing to sectoral tariffs and making significant concessions could undermine Canada’s leverage, especially as the U.S. industry is largely in favor of maintaining duty-free trade under the Canada-U.S.-Mexico Agreement.
The potential agreement includes lowering steel and aluminum tariffs from 50 to 25 percent and reducing the tariff rate on Canadian-made cars and trucks from 25 to 15 percent, with provisions for American content. The Canadian auto industry’s request for an exemption for Canadian content from American tariffs was deferred to future CUSMA negotiations.
Verheul urged Canada to clearly reject the legitimacy of the Trump administration’s sectoral tariffs and reaffirm the goal of duty-free trade at the upcoming CUSMA review. He also raised concerns about the lack of industry consultation by the Canadian government compared to the detailed briefings provided to the U.S. industry.
Former finance minister and deputy prime minister Chrystia Freeland, another council advisor, echoed concerns about the challenges of removing tariffs once agreed upon. Freeland emphasized the importance of careful consideration before committing to tariffs that may prove difficult to reverse in the future.