Canada’s LeBlanc Expects Deals With US to Resolve Trump Trade Issues

Dominic LeBlanc Photo by Stefani Reynolds /Photographer: Stefani Reynolds/B

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(Bloomberg) — Canada-US Trade Minister Dominic LeBlanc said he isn’t surprised the Trump administration decided not to renew the North American trade deal next month, and expects side deals will eventually resolve disputes over the pact.

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LeBlanc said the July 1 review milestone for the US-Mexico-Canada Agreement is “not a cliff that everybody goes hurtling off.”

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The July date, which is spelled out in the text of the USMCA, is simply “a moment where the three countries could decide to extend the agreement” for 16 years, he said. President Donald Trump has said doesn’t want to do that. But the pact still remains in place for another 10 years with annual reviews, unless one country decides to formally withdraw from it.

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Speaking Thursday at an event in Toronto, LeBlanc said Canada never expected a “rubber stamp” from the White House, and he acknowledged the president’s tendency to create “a certain level of uncertainty” in negotiations. The US has scheduled technical talks with Mexico in July, but the three countries could still agree at any point to extend the agreement.

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“I would expect that we’ll have bilateral arrangements between Canada and the United States, between the United States and Mexico, sort of adjacent to the trilateral framework,” he said. If those deals resolve key issues, “I’m hopeful that we might at that point have the extension.”

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Prime Minister Mark Carney said later Canada is also seeking a bilateral deal with Mexico. “We’ll work forward on that. But there would be some commonalities that are retained as part of CUSMA’s extension,” he said, using a Canadian acronym for the pact.

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The prime minister is under pressure to show progress as the US deepens its own talks with Mexico. Carney has recently promoted a “Fortress North America” approach, arguing expanded Canada-US trade can “make America great again.”

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US tariffs on autos, steel, aluminum and lumber have battered those Canadian industries and created broader economic uncertainty.

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LeBlanc struck a positive tone on recent talks with US Trade Representative Jamieson Greer. Canada is “answering some of the longstanding concerns that the United States has publicly spoken about in terms of non-tariff barriers,” he said. 

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Carney’s government, for example, backed off a plan to force entertainment companies such as Netflix Inc. to make larger financial contributions to Canadian film and television productions — one of a number of regulations affecting US companies that has annoyed the administration.  

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“I had a sense that Ambassador Greer and his colleagues saw the progress that they had been looking for,” LeBlanc said, adding that he believes “there’s a desire to get us on a track where we can have a bilateral conversation.”