Canada-U.S. Trade Talks Stall as Carney Turns Attention to Mexico

Canada-U.S. trade talks have been unusually quiet in Washington lately.

Most of the attention in the U.S. capital has been on trade with the United Kingdom and President Donald Trump’s second state visit there this week. The trip, full of royal pageantry, is seen as a chance for British leaders to convince Trump to lower tariffs on steel and aluminum.

Earlier this year, King Charles III visited Canada in May to deliver the Speech from the Throne and open Parliament. Prime Minister Mark Carney used the royal visit to show Canada’s ties to the monarchy, partly in response to Trump’s fiery “51st State” comments and trade disputes. Now, with Trump calling the king his “friend” during the Windsor Castle ceremonies, it’s his turn to show off some royal influence.

But have Canada and the U.S. been talking trade behind the scenes?

A senior Canadian government source, who asked not to be named, said there has been little direct contact since late August.

On August 26, Canadian Trade Minister Dominic LeBlanc, Carney’s chief of staff Marc-André Blanchard, and Clerk of the Privy Council Michael Sabia met in Washington with U.S. Commerce Secretary Howard Lutnick. The meetings were called “constructive,” and LeBlanc said “technical discussions” would continue.

Since then, the source said the teams have only stayed in touch by phone and text, and “there’s nothing planned at this time” for more face-to-face talks. A new meeting could happen in a few weeks.

When asked about morale, the source admitted the process has been difficult. “We’re just doing our best and hoping for the best,” he said.

Most of the technical talks are still happening between lower-level officials, which means progress has been slow.

This week, Carney is turning his attention to Mexico. He will meet Mexican President Claudia Sheinbaum on Thursday and Friday in Mexico City.

“It’s important for the upcoming review of the CUSMA trade deal,” the source said. “We want to stay close to Mexico to keep our negotiating power strong.”

The source warned that Trump might try to “divide and conquer” by negotiating separately with Mexico and Canada. Carney’s team believes keeping the three countries united is the best strategy.

The source denied that Canada is planning a direct trade deal with Mexico if CUSMA falls apart but suggested Carney could sign a new agreement with Sheinbaum this week to strengthen ties.

Meanwhile, there was some good news for CUSMA. On Tuesday, the U.S. Trade Representative’s office announced it was starting the formal review process for the deal and asked for public comments by November 1.

Jamie Tronnes, head of the Center for North American Prosperity and Security, said this is a positive sign. “It means the Americans are going through the proper process instead of scrapping the deal completely,” she said.

The Canadian source agreed but stayed cautious. “It’s reassuring to see the U.S. following the rules,” he said. “But we can always be surprised.”