U S THREAT & Canada ‘Nowhere Close’ on Trade Deal Days Before Deadline - Episode #157

Welcome to Tav's Headline News Reviews! 

The United States and Canada are on the brink of a critical trade deal deadline, but negotiations have stalled, leaving the future of their economic partnership uncertain. With just days to go, the pressure is mounting to reach an agreement, but significant hurdles remain. What are the key issues holding up the talks, and what does this mean for businesses and consumers on both sides of the border? In this video, we'll delve into the latest developments and analyze the potential consequences of a stalled trade deal.

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Transcript

SPEAKER_02 0:10

Well, Canada and the United States are nowhere close to a trade deal, and this is all happening days before the July 1st Kuzma review deadline, which is only four days away, and we still don't have a deal. I have two news articles on the screen from Reuters, and the U.S. Ambassador to Canada gave an interview, which I'm going to play for you right after this segment, saying that Canada and the United States are nowhere near a trade deal, and there isn't going to be a trade deal on July 1st. Now, July 1st is the first mandatory six-year review of the Kuzma Agreement. Not an immediate cancellation date. The three countries are going to meet on July 1st via video conferencing, not in person, apparently. And they were and they're basically going to decide whether to extend the deal for another 16 years or move to an uncertain yearly review of the agreement. Now this meeting that's taking place via conferencing is confirmed in one of these Reuters news articles that I have on the screen. And it's taking place, like I said, on July 1st, and it's the first bilateral agreement that is taking place since the trade war started as a tariff war started with the United States. So this is the first time they're all getting together as three as a trilateral group. Prime Minister Mark Carney stated last week that the United States and Canada held detailed technical trade talks with each trade group, James Greer and Minister LeBlanc, during the G7. But the public tone in Washington suggests there's major gaps and they have major irritants that still have not been settled. And really they're indicating nothing has changed. If you remember, the U.S. trade representative, James Greer, had already indicated a warning back in April that the Kuzma talks could run past the July 1st deadline because the Trump administration wants to rebalance the agreement and make changes to it. And we're nowhere near getting those changes that they want implemented into the agreement. Parts of the agreement, especially around auto, steel, aluminum, specific protocols revolving the intricacies of the agreement and how they're managed, still have not been settled. And they're far away, far apart from actually being those those concerns or proposals or anything like that. They're just they're not anywhere close to it. And specifically with Canada. Now, Mexico, we're not getting a lot of information, as we're not even getting a lot of information from the can from Canada as well. But apparently in Mexico is most of the irritants or concerns that the United States has with Mexico have sort of sort of been agreed to. But the Mexico doesn't want to really uh commit to anything until the deadline of July 1st. And this meeting is going to settle all that, and it'll be interesting to see what comes out of that meeting on July 1st. So let's listen to the ambassador to Canada from the United States and what he says the hurdles or the concerns that the United States has. This is an interview that he did on CTV, and it's it's gives you an insight sort of to where the Trump administration is headed and the way they look at this whole agreement.

SPEAKER_00 3:27

Um I don't think obviously we're not anywhere close to announcing any type of a framework or an interim agreement. Uh I really think it's in the hands now on our side, the Prime Minister, to determine what the next steps are uh and directionally where we're headed. We will let the president outline with clarity exactly where he is when he's ready and prepared to make an announcement. It could be in advance of July 1, or it could be sometime in July. I don't think it will go into August, but I've been wrong before. Well, I mean, you know, we were very willing. Uh we were actually kind of excited about the deal that we had in October, uh where we covered five critical areas in the following seven months on a very, very solid footing and saying, okay, now let's start filling in the other parts. Uh but as we all know that didn't happen, I think like we started off with we're not at a point where we believe that we're close to even announcing a framework or an interim agreement. The impact of what happened uh in October and November to the president and the prime minister. I think they really believe leaving on October 7th. We've got a framework for an agreement here. Uh we just need our teams to go back and fill it out a little bit uh and to having an agreement. And then, you know, poof, it's all gone. And you know, so that I think raises lots of questions about you know, how do how do we get back there? You know, a lot of us people were speculating, well, when do the talks get back on track? In reality, they've never gotten back on track the same way that we've had progress with the with the Mexicans uh getting to an agreement. I don't know what the discussions have been going back and forth at every one of the meetings uh you know early on when the president and the prime minister met uh right after the prime minister got elected. I think it was within two weeks he was at the White House. Uh they met again at Kenanaskis, uh, and then we met on October 7th. Uh the president would say, make us an offer. Make us an offer. Uh obviously at the third meeting there. Uh you made an offer. Uh the Prime Minister came in, prepares that maybe there was uh perhaps there wasn't an offer uh that was enticing enough to really say, okay, yeah, this is this is really, really good. Let's go back and let's work these things out.

SPEAKER_02 6:02

Some interesting comments there from the um US Ambassador to Canada, especially around the video that was released by the Premier of Ontario featuring Ronald Reagan and talking about tariffs. That seems to have been the trigger point to uh Trump basically deciding to cancel any further talks on Fuzma. And apparently, from what he said, we were very close to making a deal, and it was sabotaged by that video that was released. I've always been saying all along is I don't know why the premiers of Canada are down there talking to representatives of the United States regarding the tariffs and convincing them that this is a bad idea and they should tell the president. The people they're talking to are not friends of the president. They're showing up on networks that don't like the president. They're talking to democratic governors, they're talking to democratic leaders, not really talking to what I would call pro-Trump people or media. And that's been a problem because it always gets back to the president and his administration, and that doesn't help our cause. I have two articles on the screen, one from Global News and the other one from Reuters. And basically, why does this matter? Well, the Kuzma Agreement is the backbone of Canada, U.S. Mexico trade, and uncertainty could hit auto, steel, aluminum, lumber, and agriculture manufacturing from border to border and supply chains. The government of Canada and Prime Minister Mark Carney, all the way through this from the beginning, have been trying to show that Canada can protect jobs and its industries in Canada. However, the Trump administration's position has publicly criticized the trade agreement and questioned whether they even need a trade agreement with Canada or Mexico under the current framework. In fact, we've heard the president say many, many times that they don't need anything from Canada. Well, we proved them wrong a couple of weeks ago because I proved to you that they need our oil. They they buy a lot of our oil. And that's not all true. They do need us and we need them, and we need to come to an agreement. So the fact that we're nowhere near an agreement is is probably a big problem. And I still think it's our uh representative, Mr. Leblanc, and and his supporting cast. I don't think I think there's a disconnect, or we're not listening to the right things, or something's not right. And the prime minister continues to play this the long game and pretend that he does we don't really need them and he ain't gonna sign a bad deal, he ain't gonna sign any deal unless it's good for Canada. And they keep repeating this, they keep attacking this whole tariff war uh openly, and they get premieres and other ministers in the Canadian government to go down to the states and make public statements. And I think the approach is all wrong, and we're in this mess because of the United States attacking us with these tariffs, and now we're not making it any better by us sending the wrong people down there to basically stir the pot and talk to the people that Trump like and they don't like. So the big risk here is that if the three countries don't agree to extend the Kuzma Agreement, then it can continue without just a yearly renewal. And the United States has made it quite clear that they're not interested in renewing it, they're interested in restructuring it and changing uh some basic issues or clauses in the agreement. They have uh some irritants in the agreement that they want changed. Now, if you remember, President Trump in his first term, he agreed with Prime Minister Trudeau. They negotiated the Guzma Agreement and and now he doesn't like it. Well, I think there's a lot of political pressure at the time. He was a first-term president trying to get re-elected, and we're also under the uh the attack of of COVID. So there's a lot of things going on there, and I think that agreement was rushed by the Trump administration at the time, that first term uh that he had, and he learned a lot from that whole exercise, and he never was happy with it. And this these things now are coming to the surface, and he wants major changes made. Um, and um the fact that we're not going to renew it now will just create more uncertainty in our markets here in Canada. But more importantly, without an agreement long term, it is going to definitely affect businesses making investment decisions in Canada. Let's watch this video now. There's a press conference that the President of the United States gave on one of his airport tarmac, just about before he gets on in the plane with the media talking about the Kuzma agreement. And then following that, there's some comments there from the Prime Minister, and let's listen to those now.

SPEAKER_03 10:35

I'd rather have it terminated.

SPEAKER_02 10:38

No, those are different things, so I just want to become clear.

SPEAKER_03 10:40

I would rather not have the agreement, but it I may sign it. Right. But I would rather we do better as a country if we don't have an agreement. So are you thinking of Yeah, I'm thinking about maybe we won't be able to make a deal.

SPEAKER_01 10:52

I would uh what I have seen with the president um is that you're not close to make a deal and then you make a deal. I've seen that in different cases. It doesn't mean the deals are good deals, but it means being prepared, uh having done the work, knowing what you want. Um so both things can be true.

SPEAKER_02 11:16

So what are the key tension points or irritants, supposedly, that uh are out there? Uh wants relief from U.S. tariffs, in particular in the sectoral areas like steel, aluminum, auto, and other sectors. Auto and rules of origin, the Washington and the United States want tougher rules to favor North American production. Steel and aluminum imports, the United States argues imports from Canada and Mexico have grown too much under the current agreement, and they want that modified. As I've said many times, the other irritant that the Trump administration has is that President Trump does not believe in trilateral agreements. They want a bilateral agreement. Canada has said that bilateral agreements with the United States could accompany the Kuzma Agreement, which is a trilateral agreement, but the United States is not interested in that. They like the one-on-one agreements. And of course, Washington and the Trump administration, the political apparatus there in the United States appear to be using the deadline to pressure Canada into giving concessions to make a deal. But the Prime Minister has said many, many times that he is only going to sign a good deal and no other deal. And I guess we will be the judges of whether it's a good deal or a bad deal. But I could tell you right now, there's nothing on the table. There's been a lot of talk, there's been a lot of meetings, and now they're gonna have a meeting on July 1st. It's gonna be via video, not in person, which leads me to believe that there's nothing much is gonna come out of there other than an announcement that they're not renewing. And it's just it's gone on for months and months and months, and our team in Canada that are representing us haven't scored any goals. We've given many concessions. Just recently we gave a concession on the streaming tax, um, internet streaming. Um we gave we gave up on the digital tax. We uh we've given concessions over and over again to sort of sort of try to see if we can get the ball moving, but it hasn't moved. And supply management is an is a big issue with the United States. They want this unfair, what they call an unfair advantage to of subsidies to in companies or industries in Canada to be uh modified as well. So there's a lot, very complicated stuff, but that's what they're getting paid for, especially our our representatives, uh Mr. LeBlanc, who's leading our team, uh Mr. Wiseman, who is the new uh ambassador to the United States, which is hasn't really been out in the media very much, but he is he does have a lot of business and trade background. Um so that group of people, they need to they need to produce something. And we don't get very much information from our delegation, and the prime minister plays his cards very close to his chest, but the United States is the opposite, they're pretty open in what they tell the media is the problem, and we are either not listening to them or we're just choosing to ignore them and hoping that that it goes away. So, my final comment is that I don't think it's going to get renewed. I think we're going to be doing these annual renewals. Is there a possibility that President Trump walks away from the agreement, decides to just give us notice maybe on July 1st and say that they're getting out of the agreement and force bilateral agreements? That could happen. As we know, President Trump is very unpredictable, and he says one thing and does another. But there has been a pattern right from the beginning, and we're now, this is now gonna come to a head on July 1st. It's not a drop-dead date. It's not a we're not gonna go over a cliff or anything like that, but you know, it was a target. We didn't meet it. Now we're gonna we're gonna have to uh um see what comes out of this July 1st meeting. I just hope that the United States doesn't walk away from this because as I've said, this is the most important agreement that we have to negotiate for our economy, our companies, our jobs here in Canada. And if we don't get a good deal, or well, the the best thing is to renew it for 16 years, because we have a good deal, but especially the auto industry, which is being shielded from tariffs because of the Kuzma Agreement, which ironically I find that the auto industry now is planning to go on strike or are right now renegotiating their contracts with GM Ford and Chrysler. I think they're going with Ford first, which is the plan, which is always the plan. They go with the strongest of the three and then try to work a deal, and that sets the pattern for the other two. And I think the timing of that is terrible. I think we should find out where we stand first before we start renegotiating contracts with those companies, especially when the Trump administration is pressuring them to move all their manufacturing down into the United States. I don't even know how that agreement's gonna take place or how that discussion's even gonna happen at the table when there's so much uncertainty. How do you discuss contracts when you don't even know whether you'll still be in business in Canada? It just doesn't make any sense to me. Anyhow, let me know your comments and your thoughts on this particular subject and what this July 1st, what do you think is gonna happen? I will reply. Don't forget to subscribe so you don't miss any of my episodes. And please hit the bell key, it helps the channel. Thanks for watching. Be safe, and we'll see you on the next one.