Canada's Trade Deal Crumbles – US Demands 'Entry Fee' Before Talks Even Start! - Episode #139!

Welcome to Tav's Headline News Reviews! 

The United States has rejected the CUSMA trade deal, leaving Canada's trade future uncertain. In this video, we explore the implications of the US rejection of the CUSMA trade deal and what it means for Canada's economy. We discuss the potential consequences for Canadian businesses, workers, and consumers, as well as the possible next steps for the Canadian government. With the trade deal in limbo, Canada must navigate a complex web of trade relationships and find new ways to promote its economic interests.

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Transcript

SPEAKER_04 0:08

Thanks for watching on Saturday, April the 25th, 2026. So things are mame. So things are mame uh heating up leading into these renegotiations or review of the Kuzma or what used to be called the NAFTA agreement in July. And the rhetoric between Canada and the United States, US officials, trade officials, and Canadian politicians, it's it's really getting pretty heated, and people really don't know where things stand. Um, because it sounds like both sides have a lot of grievances that have to be worked out, and uh we're not really getting a full picture of what's going on. We're gonna try to figure it out today based on what people are saying, try to get an understanding and try to see if we can figure out where this is all headed. Uh let's look at it. On the screen is an article from the Wall Street Journal and also a CTV news article regarding the Kuzma agreement. And Commerce Secretary Howard Lechnick gave an interview down in the States and he made some comments that rang some alert bells up here in Canada, and some people didn't like what he said. We're gonna play that. I'm gonna play that in a little while so you can hear it for yourself. But the Kuzma agreement, which uh replaced the NAFTA agreement, is facing a renewed uncertainty ahead of the uh review, the 20 mandatory 2026 review in July. The Commerce Secretary indicated that President Trump views the Kuzma agreement as it is right now as a very bad deal and must be reconsidered and reimagined, is the words that he used. The Commerce Secretary, uh the movement of manufacturing jobs, especially the auto plants, to Canada and to Mexico to avoid to break up the unions down in the States, the impact on the U.S. industry and union jobs, the broader structure of North American supply chain. So he had a basically a list of things that he talked about that were that were grievances or um irritants or what they're calling it, and he expressed himself in this interview. So let's listen to it right now, and uh then we'll be back again with uh the next slide.

SPEAKER_07 2:05

Isn't Trump committed to extending the USMCA ahead of the July deadline?

SPEAKER_06 2:10

I think he thinks it's a bad deal. Right? He thinks making Mexico and Canada be treated economically like Georgia and Alabama without them actually being committed is a bad trade. I think it needs to be re reconsidered and reimagined correctly. There are parts of Mexico that are fundamental to us, there are parts of Canada, you know, their energy and other things that are that are important to us, but the but the concept of taking an auto plant out of Ohio and Michigan and putting it in Mexico to break the Union and to break our people is nuts. It was a bad industrial policy, it harmed America, and President Trump is going to fix it, he's bringing it back, you're gonna see it get brought back, and I think it needs to be reimagined and needs to be readdressed. There's plenty of good knit, but there's a huge amount of bad knit that needs to be reconsidered for the benefit of America.

SPEAKER_07 3:06

The former top Canadian trade negotiator said the other day that uh time is on Christopher Friedland is like the worst. A guy, I'm blanking on his name here, but the time is on our side because the pressures on the US are only going to increase over time. Basically, you guys are in political trouble. The longer they wait, the better a deal you're gonna have to do.

SPEAKER_06 3:25

Good for them. That is like the worst strategy I've ever heard. They suck they look. We are a $30 trillion economy, right? We are the consumer of the world. Okay, Carney has a problem with us. He gets on a plane and he goes to China. Does he think China's the Chinese economy is gonna buy his stuff? China is entirely an export-driven economy, right? So what did he do? He came back and said, Oh, we'll take their electric cars.

SPEAKER_04 3:54

I mean, is this on the screen now is a uh news article from the CVC. First of all, Kuzma talks may run past July 1st deadline, U.S. trade envoys. So this is Jamison Greer, this gentleman right here, giving a press conference. He's one of the lead negotiators. He's basically the counter to our Minister LeBlanc. Uh so he leads the trade initiative down there in the States. And he was making a comment that there's just too many issues that still need to be resolved. The United States is already sitting down this week, coming up with Mexico, but yet to sit down with um with Canada. And he doesn't think they're gonna meet that July 1st deadline. This Reuters article here says that Canada's trade negotiator says not all U.S. trade issues may be resolved by July 1st. So it sounds like both parties are saying that um that they're not gonna they're not gonna meet the deadline. And the agreement, the Kuzma agreement, um, it must be reviewed by July 1st of 2026. It's a mandatory review, or it could shift to an annual review, which will create long-term uncertainty for the markets and businesses, hence uh will make businesses or uh create a situation where businesses start holding back on investing in capital in in Canada. Let's talk about Canada only. The U.S. is signaling that it's uh pushing for major changes in the agreement. So it's not just a review for them, it's a renegotiation, even though the prime minister keeps harping that it's a review. They want uh stronger domestic production incentives, uh potential tariff leverage on uh in the negotiations for non-compliance, and ongoing tensions, including the the tariffs on steel, aluminum, auto, and softwood. The United States wants that segregated from the Kuzma agreement or anything that's negotiated. They want those tariffs to stay, they don't want anything changing on those tariffs, and U.S. concerns regarding Canada's agreement, trade agreement, or MOU with China, and they're concerned that China and other countries will use Canada to bring their products inside Canada and somehow bring them across the border into the United States. And you'll hear in in some of these videos that I'm gonna play for you, you're gonna hear them talking about uh place of origin or product origin. So the United States wants to incorporate that into the Kuzma Agreement so that if a product is made, uh say in China, it can't come into the United States, so people blocked at the border. So those are the things that that the highlight high-level issues that the United States has with the Kuzma Agreement. And I've been saying all along that I believe it's not going to be a trilateral agreement, it's gonna be a bilateral agreement. I suspect that the United States will come to an agreement with Mexico before they get an agreement with Canada, and that's because Mexico is a lot more compliant with the grievances that the United States has with Mexico, and in fact, Mexico is already doing things that the Americans wanted uh ahead of their sit-down next week. Now let's take a look at uh two articles. We want to see what the Canadian response is to what uh the United States is saying uh publicly. The Canadian government isn't really open with what what their strategy is, they've not really been giving Canadians a lot of information as to what the status is of Kuzma or the tariffs or anything about it. They've been very tight-lipped about that, and they give us platitudes when they when they have uh news conferences. And I've highlighted that with Minister LeBlanc. He really doesn't say anything, just says the same thing over and over again. And on the Reuters article that's on the screen, Carney announces new Canadian Trade Committee as a review of the trade deal with uh U.S. NIR. So we'll talk about that in a minute. We have a new lead negotiator, I thought it was uh Mr. Wiseman, uh, who's the ambassador in the US along with with the minister uh Mr. LeBlanc, but apparently not. There's been a new lead negotiator, chief negotiator, if we want to call it, uh, that's been appointed by the prime minister. Her name is Janice Char Charret, I think it is. And basically, the Prime Minister has created a new U.S. uh trade advisory committee. There's always been an advisory committee, it was created by Prime Minister Trudeau, but this he's revamped it, he's brought all kinds of people into that new committee, and I'm going to show you it in a minute. Canada's trying to hold on to what is in the agreement. The United States wants to change it. You'll also hear a video from Mr. James Greer, the lead negotiator for the United States, talk about the the differences of ideology economic ideology between Canada and the United States, or Prime Minister Kearney and President Trump. Prime Minister Kearney wants the global trade, diversified trade, versus the President of the United States wants to correct for all the global trade that the United States has been doing, and you'll hear about that. Our chief negotiator says Canada has no appetite at all uh to reopen or rewrite or renegotiate the Kuzma deal. It's basically her marching orders is to maintain status quo, and she views the July deadline as a checkpoint and not a situation where we're falling off a clip cliff and it's a disaster. Uh and she's right, it's if it doesn't get something happens July 1st, it will just get renewed year to year, and I've talked about that.

SPEAKER_05 8:55

We have multiple levels of contact. We've uh we've worked through a series of issues. We understand what some of the uh what the Americans would call trade irritants or trade issues are. We have some uh on our side as well. Uh we're well prepared around those issues. We will sit down and work through those issues with the broader uh approach in the uh in the negotiation.

SPEAKER_04 9:18

Uh we've made some counter proposals, uh which let's take a look at another two articles, another one from the CBC. Washington demands entry fee from Ottawa before the trade talks start, basically. That's what a source tells the CBC. Another one's from the Global News. Prime Minister Kearney says no to making any concessions to get the trade talks started. So this word entry fee, I don't know where that came from. I haven't heard any politician talk about an entry fee. Has the United States forwarded their list of grievances or irritants or issues that they have with the Kuzma agreement? The answer is yes, there's plenty of documentation regarding that. Canada initially counter gave them a counter-proposal to those list of uh grievances that they have with the agreement, and now they've come back with another list, apparently. And it again, it looks like they don't want to sit down until Canada addresses those or gives them some indication that they're willing to talk about those grievances. And those grievances, from what I hear, are the auto industry, the sectoral tariffs, and the most important thing, supply management. The president of the United States has a real thing about supply management, and he's made promises to those farmers down in the states that he was gonna get that result. And I don't think he's gonna turn around on that. I don't think he's gonna back down from that. But let's hear now from uh Jamison Greer, the lead negotiator for trade with Canada for the United States. He's basically leads with all trade initiatives. His responsibility is trade with the United States, whether it's the EU, China, Japan, whoever it is, this is the guy that is that's leading with it. Now, what you're gonna listen to is he's giving testimony before the House Committee in the United States, and I want you to hear his comments because his comments tell a story as to where things stand, and they're very important. So let's listen to him.

SPEAKER_08 11:11

So one thing, if if you look at what's happened over the past few months, Mexico has taken some important steps to help get at this issue. There's much more to do. Mexico on its own has decided to raise tariffs on certain products from China and Vietnam and certain other economies. And this is because Mexico itself understands that it needs to be better aligned with the United States on trade policy to avoid the kinds of issues you're talking about, to avoid subsidized products coming in from Asia and elsewhere and undermining the North American market. So Mexico has already taken steps on this issue. We need to adjust the rules of origin. In Trump's first term working with this committee, we adjusted rules of origin for automobiles, and that drove more investment in automotive production in the United States. We need to take that same model and we need to take it to other goods as well to make sure that rules of origin are robust and strong, to make sure that our manufacturers have an incentive and a comparative advantage relative to others.

SPEAKER_01 12:10

So is Canada making any of those changes that Mexico has? Because one of the manufacturers I see in this room, in fact, his direct competitors are the Canadians and it comes to defense equipment. So are the Canadians playing by the rules there?

SPEAKER_08 12:28

So uh you know, a little bit on steel they they've done this, but overall they've indicated that they want to uh be trading more. They want to have more trade agreements with more countries. They're doubling down on globalization when we're trying to correct for the problems of globalization. So those are two models that don't fit together very well. Uh I have had I've had conversations with Canadians, we're in regular contact, uh, and we've talked about these issues. Again, there'd have to be a rule of origin uh put in place.

SPEAKER_04 12:54

And if the Canadians don't want to have that rule of origin, then we'll have to have some other border control to make sure that we're after listening to that uh testimony that Jameson Greer gave to the House Committee. I think that tells a lot as to what their position is. Uh, if you take that and you include the comments made by the Commerce Secretary of the United States, it sounds like we are going to be swimming against the flow of water. It's gonna be a tough deal, tough negotiation if we even get there. I don't know. Um, that's what the uncertainty is. Again, more uncertainty in the Canadian economy. That's not what we need. And it's gonna be even more uh heightened if Mexico makes a deal with the United States, and we're basically, as I've said throughout my episodes and way right from the beginning, that if Mexico gets a deal before we do, we're gonna be out there all by ourselves, and it's gonna be even harder to negotiate with the United States. But before we get to what's on the screen, which is this new committee that the Prime Minister has formed, and I call it a new because he's basically revamped it, repurposed it, and but we'll talk about it. Uh, the Ku Kuzma Agreement for all of you, it governs uh one of the largest trading blocks in the world, if you don't know that. About $30 trillion worth of GDP, gross domestic product. About 85%, 85% of Canada's exports to the United States are tariff-free under the Kuzma Agreement. So that Kuzma agreement gets changed or gets killed. Uh basically the United States withdraws from the agreement after making a deal with Mexico, uh, a bilateral agreement with Mexico, that's gonna be a big problem for Canada. And we can pretend like it's not going to be a big problem, but it's gonna be a big problem for our economy. And I think we're um we all should be paying attention to that. So uncertainty, more uncertainty, slow investment in Canada impacts hiring decisions we've talked about before across industries. Instead of hiring full-time people, they're gonna hire part-time people. Capital is gonna be held back, no one's gonna invest in increasing manufacturing, opening up new plants, changing the way they do business. Nothing, nothing's gonna happen because of the uncertainty. So, now let's get to this article that I have on the screen, which is the committee. And there's a lot of people on this committee, as you can see on the list on the right-hand side. A lot of them are people that we know that we see quite often, like the national president of Uniform of the Union, uh, Flavio, the president of the Automotive Parts uh factories association, we have a former conservative leader in here uh somewhere. Uh so there's a there's there's a great group of people here that have a lot of knowledge, experience that they can bring to bear at the table for the prime minister and his administration and dealing with different issues uh related to the Kuzma negotiations. So it sounds like based on this list, that the Prime Minister sees this situation very seriously. He also has basically determined that he needs all these people at the table because there's going to be negotiations, there's not going to be just a simple renewal or or review. Um, and with in combination with his uh YouTube video that he did to on when he had General Brock in 1812 and he talked about fighting a war, I think he was preparing the nation, Canadians that for bad news. And he's bringing everything that he can to the table to try to mitigate that. And I think this is what this committee is all about. I think it's a great move by the prime minister. Is it uh something out of the norm? No. Uh the committee was there, he just made it better, a lot better. And this is something that I would expect to see from him if he was running a major corporation uh in Canada or anywhere in the world. Uh, he's doing the right thing and he's bringing the right experts to the table to provide good advice. So now um, I gotta play you a video again, and uh, we'll talk about what you see on the video right after uh the video is finished.

SPEAKER_00 16:34

Well, I guess what's just uh disrespectful, we we never started this terraform, and I don't believe the American people did. It was uh Secretary Lutnik, uh followed by President Trump as well, that uh tax.

SPEAKER_05 16:47

What we want to do is make progress as the whole. These issues, issues such as uh uh uh decisions on which alcohol to to put on the shelves, uh we can make progress very quickly on that. With progress uh with other uh in other areas. I'm so confident uh that we will make progress. But um and then those judgments will be made by uh by the provinces and we'll encourage them on all of these issues. This is a review process that's baked into the existing framework of the agreement. Um it's a negotiation. These things um have their own rhythm. Uh and um they also have what's happening above the surface and what's happening below the surface. And we'll see in the there's two parties in a negotiation. One we're not sitting here taking notes, okay, and uh taking instruction uh from the United States. It's a 50 percent tariff on aluminum, 50 percent tariff uh on steel. Uh the derivative measures that have been put in place on both of those. Uh the uh auto tariffs, which are uh you know inconsistent with the uh the side letters, the tariffs on um on force products. Uh so there's a series of issues there uh that that are right there in front of us, uh in front of us all.

SPEAKER_03 18:05

I mean, there are I think what he's gotta we have to focus on is results. Uh the the the prime this is a prime minister who's uh I've never seen him, frankly, a Prime Minister get so much uh um media attention for meetings, um councils, committees, uh new agencies that he has created, but who has done so little in actually delivering results for real people. So I think we need to deliver actual results by getting, for example, tariff-free trade using our leverage to put an end to steal.

SPEAKER_02 18:37

So, with respect to uh trade discussions uh with the United States and particularly with Trade Representative Greer, um, we don't have to say when they'll begin because they are already underway. Um I was in Washington a few weeks ago, had a cordial, constructive meeting with Ambassador Greer. As you know, President Trump had suspended those uh negotiations last fall. Um they have been ongoing now for a number of weeks. Um I exchanged messages with Ambassador Greer um again last week. I'm looking forward to uh a discussion uh, I would hope in the next couple of weeks we're finalizing that opportunity. But I think it's important to note that it's not only my conversations with Ambassador Greer or Secretary Lutnik. For example, our chief negotiator uh negotiator, Janice Charrett, has had a number of conversations over the last few weeks with her counterpart in the U.S. trade representative's office. Ambassador Wiseman has been very active, updates me and our colleagues almost daily on discussions he's having with senior U.S. officials.

SPEAKER_04 19:50

My own, there's a lot to cover there on that video, that one video. Number one, I don't know why my premier, Doug Ford, is on American TV. Networks that hate the president talking about the trade deal or Kuzma or the situation with the tariffs or anything. He shouldn't be down there. That's just my opinion. He isn't down there on his own. He's down there on the order of the Prime Minister for sure. No doubt about that. Especially when we're coming into these delicate review negotiations here. The Prime Minister say in one hand he's saying it's a review, and another hand he's saying it's a renegotiation or an else negotiation. I don't think he should be down there, especially on those networks. If he's gonna be down there, let's get on the conservative networks as well, so we can show balance. And you can rest assured that the that the American administration is watching it. This is how we got in trouble the first time when he ran that during the World Series, and uh the president cut off all negotiations with Canada, and that's probably one of the reasons why we haven't really got into negotiating, uh sitting down and negotiating, and the Mexicans have already, uh setting aside the fact that the Mexicans are complying with some of the grievances that the Canada the Americans put before the bot. You can see, and we're gonna cover a couple more things on that video, but before we get to that, here's an article. Here's Mr. Wiseman, he's our new ambassador for uh Canada in the United States, and he is a close friend of Prime Minister Kearney, he's a business background, is business, and he gave testimony uh in front of the uh committee up in Capitol Hill, um in Ottawa. And he says that uh so the US have been respectful, and I I highlighted this because the word here is meetings, not sitting down to negotiate, just you know, just discussions over the phone, sitting down at lunch, meeting in a boardroom for an hour, which I doubt is happening. But if you listen to LeBlanc, Minister LeBlanc on that previous video, he's he's indicating everybody's talking to there's negotiations happening already. There isn't anything going on other than talk. That's the key. And we haven't produced anything since this trade war. We've got nothing, zero. We've given up concessions with the United States hasn't given us anything. In fact, they've added more to us. And this was this article is April the 23rd. And so he's I thought he was our lead negotiator. He's just part of the team. It's Janice is the the uh is the lead uh and the opposite to uh Mr. Greer. The other thing is you heard Pierre Polyoth, his comments, his response to the Prime Minister. You also heard Mr. Minister LeBlanc uh talk about everything that they're doing, everything they're talking about, doesn't give us any substance, just talks in in what I'd like to call gibbili boo, doesn't tell us anything. So um that is that is what's going on behind the scenes, and I'm concerned about what I'm hearing on both sides. I don't think we should be down in the state uh giving interviews, especially if it's not a government official, it's a premier, a premier that's already taking um action against the retaliatory action against the United States during this tariff war with the cert tax on electricity. He took booze off the shelves. By the way, the the booze off the shelves. I don't know why it's it sounds like a grievance or whatever, because it's only one percent of sales come into Canada from the United States. So I'm not sure, unless that number's wrong, which I picked up from another article, it just doesn't make any sense. Yes, it hurts some states there, um, but you know, when the when the commerce secretary was being interviewed uh regarding the liquor sales and he was uh expressing the grievance, the person that was interviewing was a Democrat. So um that is another uh another story right there where she was more focused on what the Commerce Secretary, his rhetoric rhetoric, and not uh the issue regarding selling alcohol in Canada. And you know, we got to do something. We can't, you know, and we shouldn't give any concessions to the United States until we get concessions. So for every concession we give, we should get something back from the United States. It shouldn't be a one-way street, just like the Prime Minister says. So that is uh what what I think. So I final takeaway or comments on this whole thing after reviewing everything that you've seen as well, is that the United States' position has has shifted from uh focusing on economic nationalism and reshoring jobs into the United States. And that's that's their focus. That's what Greer described before the committee. That they're not they're looking to correct global uh globalization of trade in the United States, something they've never done before, and they've changed the way they approach it. Canada's position is they just want the old way, they want to preserve the Kuzma Agreement, stabilize the situation, and avoid getting into renegotiating the Kuzma Agreement if they can. I think moving into this whole scenario, I think it's it's gonna be an economic showdown uh on a different approach here in Canada as far as our economic strategy. The United States is on a different approach or path with their economic strategy and and I they're not compatible, they're not they're gonna they're gonna bounce off each other, and it's gonna be interesting to see what what comes out of those negotiations or that review or renewal or whatever you want to call it. And I think it's I think we're in for a period of more uncertainty, and hopefully we can come to an agreement and get this all over with. I'm gonna be watching Mexico very closely. If Mexico gets that bilateral agreement, I think it's gonna be harder for Canada to negotiate with the United States, but we'll see. They need us, we need them more than they need us, but they need us. They need us for the natural resources and other things that they can't easily get around the world. So I think there's got to be some give and take, and we are neighbors. So hopefully they can do that. Let me know your comments and your thoughts regarding this issue and what you think and what how you think the the situation stands right now. Thanks for watching, be safe, and we'll see you on the next one.