Canadian Prime Minister Mark Carney on Thursday reiterated Ottawa’s willingness to finalize a trade agreement with the United States that benefits both nations, while rejecting claims from U.S. officials that Canada walked away from negotiations for political reasons.
Carney: U.S. signals flexibility after earlier ‘our way or the highway’ stance
Speaking to reporters in Thunder Bay, Ontario, Carney stated that Canada remains prepared to strike a deal when the Americans are ready, emphasizing that any agreement must serve the interests of workers, families, and businesses in both countries. He noted a recent shift in the U.S. approach, describing a prior posture of inflexibility that softened in the final hours of talks last month.
"There were a few issues that the United States was arguing right up to the last hour," Carney said. "Now, they're not. So all of a sudden, they don't care about Canadian language or culture and those elements. Well, if they didn't care, they shouldn't have kept them in the deal."
U.S. officials accuse Canada of derailing talks for political gain
U.S. Commerce Secretary Howard Lutnick had previously claimed on CNBC that Canada "blew up" a nearly completed trade deal with the U.S. for political reasons, asserting that Ottawa’s Liberal government prioritized domestic elections over economic cooperation. Lutnick added that Canada had treated President Donald Trump with disrespect and would alter its stance after mid-October elections.
In response, Carney dismissed Lutnick’s remarks as unfounded, stating, "I don’t think, with all respect, appointed, unelected cabinet members in the United States are experts on Canadian politics." He framed the breakdown in negotiations as a result of last-minute U.S. demands that undermined the stability of any eventual agreement.
Trump warns of economic consequences for Canada
President Trump amplified the dispute on Truth Social, accusing Carney of portraying him as an "enemy" and warning that Canada’s economy would suffer as a result. "It is very good for Canadian Politicians like Prime Minister Carney to make President Donald J. Trump 'the enemy,' until their Economy collapses," Trump wrote. "Then it will prove to be very bad for Politics — Worse than anything that has ever happened to a Canadian Politician. Just watch!"
Tariffs imposed as talks collapse
Negotiations between the two nations broke down on August 21, hours before a deadline set by Trump. The U.S. subsequently imposed tariffs on approximately $20 billion worth of Canadian goods, including hockey sticks, wine, cement, lumber, and certain apparel and beauty products. Canada retaliated with tariffs of its own on U.S. goods.
Carney attributed the collapse to U.S. proposals that he described as unfair and uneconomic, including changes to automobile tariff agreements and restrictions on Canada’s ability to negotiate trade deals with other countries. Lutnick, however, contended that Canadian officials had initially sought an interim agreement before broader negotiations under the U.S.-Mexico-Canada Agreement (USMCA), and that a deal had been reached before Canadian officials backed out.
Domestic reactions reflect divided perspectives
Public and political responses in Canada varied. A letter to the editor in the Toronto Sun criticized both governments for imposing tariffs, framing them as taxes on their own citizens. One reader argued that the dispute would drive up costs for Canadians, while another suggested Carney was strategically positioning Canada for political advantage by provoking Trump ahead of elections.
Path forward remains uncertain
Both sides have left the door open for renewed discussions, though the timing and conditions for resuming talks remain unclear. Carney maintained that Canada stands ready to engage when the U.S. demonstrates a willingness to negotiate in good faith, while U.S. officials have framed the breakdown as a deliberate Canadian decision with political motivations.