Canada Keeps Auto and Metal Tariffs as Carney, Trump Restart Trade Talks

Canadian Prime Minister Mark Carney held a telephone call with U.S. President Donald Trump on 21 August, their first publicly disclosed contact since trade negotiations collapsed in June. Ottawa described the discussion as “productive and wide-ranging,” covering bilateral trade challenges, the conflicts in Ukraine and Gaza, and options for a new economic and security framework. Both leaders agreed to speak again shortly. The outreach comes amid heightened tensions after Washington last month lifted most exemptions and raised tariffs on Canadian goods not covered by the U.S.–Mexico–Canada Agreement (USMCA) to 35 percent. Carney said Canada will meanwhile keep its own duties on U.S. steel, aluminum and autos, arguing they protect domestic industry while talks continue. He added that Trump told him a Canadian move to scale back counter-tariffs could help kick-start negotiations, but no timetable was given. Carney said the current trade accord with the United States is “the best it has ever been,” yet acknowledged the USMCA will have to evolve to reflect a “very different trade environment.” He signalled that a deal covering strategic sectors could be reached before the formal USMCA review begins in 2026, and that Ottawa and Washington will intensify discussions in the coming weeks. Both governments said they aim to preserve competitive advantages for their respective workers and businesses.