Trade deadline nears: US, Canada signal progress but no final agreement yet

The United States and Canada are racing against a deadline set by Washington to finalise a trade agreement, with President Donald Trump saying talks are “moving along” but stopping short of confirming a deal.

Speaking to reporters on Friday, hours before the deadline, Trump said he expected to reach an agreement with Canada. “We should be able to have a deal with Canada. We're also starting on a new deal with Mexico. A much better deal for the United States. I only make good deals,” he said.

The full framework of the proposed agreement has not been made public. However, details shared with several media outlets suggest that the US is prepared to reduce tariffs on Canadian steel and aluminium from 50 per cent to 25 per cent, and on Canadian automobiles from 25 per cent to 15 per cent.

In return, Canada is reported to be considering allowing American dairy producers greater access to its market, restoring the sale of American alcohol in Canadian liquor stores, and removing its retaliatory tariffs on US goods.

The prospective deal has drawn criticism from Canada’s opposition leader, Pierre Poilievre. He said any agreement that imposes “one-sided” tariffs on Canadian industry would be “a bad deal”. “I am concerned with the de-industrialisation of our economy if our key industries pay one-sided tariffs,” Poilievre told reporters on Friday.

Manitoba Premier Wab Kinew has also voiced reservations, urging Canada to “fight” and not rush into concessions. His stance is significant because Prime Minister Mark Carney requires the support of provincial premiers to restore sales of US alcohol on liquor store shelves — a step that could prompt the US to lower tariffs on Canadian metals and autos.

Carney, who took office recently, faces a tough battle in securing buy-in from provincial leaders and opposition parties. The negotiations represent one of his first major tests on the international stage, and the outcome will likely shape his political standing.

The trade dispute traces back to US tariff actions that were justified on national security grounds. Canada responded with retaliatory tariffs on US goods, creating a cycle of escalation that has affected industries on both sides of the border.

The current talks are part of a broader re-alignment of North American trade relations. Trump has also signalled a new deal with Mexico, which he described as “much better for the United States”. The specifics of that arrangement remain undisclosed.

Analysts say the Canadian government faces a delicate balance between securing economic stability and safeguarding domestic industries. The proposed tariff reductions, if confirmed, would offer some relief to exporters, but the conditional nature of the deal has sparked debate within Canada.

As the deadline looms, the outcome remains uncertain. Both sides have expressed cautious optimism, but no definitive agreement has been announced. The coming hours will determine whether the two countries reach a deal or face continued uncertainty in their trade relationship.