The frontrunner to win Canada’s election, Prime Minister Mark Carney, has warned the era of close US ties “is over,” but experts say restoring free trade with Washington will be crucial for whoever wins Monday’s vote.
Carney, the Liberal Party leader, has throughout the campaign issued stark warnings about future US relations, responding to President Donald Trump’s trade war and talk of making America’s northern neighbor the 51st state.
The ex-central banker has also pledged to use his international financial experience to forge closer ties with Europe and Asia to curb Canada’s reliance on the United States.
But for Steve Verheul, Canada’s deputy minister for trade policy during Trump’s first term, pursuing overseas markets may be wise, but it doesn’t offer “quick fixes” to the Trump challenge.
“It’s a timing problem for Canada,” Verheul told a policy conference in Toronto.
Trump’s bid to use tariffs to force companies to bring production and jobs back to the United States “is going to fail,” said Verheul.
Ramping up major manufacturing sectors takes far longer than Trump expects, and the business community understands that, he added.
“I think that the US will eventually figure out that isolation is not the best route for it to go down and will start looking for allies again, and North America is its safest zone to do that,” said Verheul, now a private sector consultant.
“We need them. They need us.”
Last year, 76 percent of Canadian exports went to the United States. Canada buys more American products than any other country.
Bilateral trade in 2024 amounted to $762.1 billion, according to the office of the US Trade Representative.
Who’s in charge?
Trump and Carney have agreed Ottawa and Washington will discuss trade after Canada’s election.
There has already been a steady stream of Canadian diplomatic efforts to avert trade conflict, with federal ministers and provincial premiers heading to Washington for talks with members of Congress and Trump’s cabinet.
The impact of those efforts is unclear: Canada has been spared some Trump levies but tariffs on steel, aluminum, autos and certain other goods are already causing economic pain.
Gitane de Silva, a former Canadian diplomat who specializes in US relations, told the Toronto forum that nearly 100 days into Trump’s second term, Canadians don’t yet know who they should be talking to in Washington.
“In the first Trump administration, the title did not infer influence,” she said, joking that “if you wanted to do something (with) the Bureau of Land Management, you didn’t go to the Secretary of Interior, you went to Eric Trump’s duck-hunting buddy from Idaho.”
“I think it remains to be seen in this instance who are the people that have the most influence, and that’s really crucial,” said de Silva, who is now in the private sector.
‘Fear of God’
One of Canada’s most prominent envoys through the trade war is the leader of its largest province, Ontario Premier Doug Ford.
On top of regular US cable news appearances, Ford has talked repeatedly with US Commerce Secretary Howard Lutnick, trying to ease tariffs that are pinching Ontario’s auto and steel sectors.
“We will continue making the case at all levels of government in the United States that we’re stronger when we work together,” Ford said Thursday.
But the trust Canada felt towards the United States “is now gone,” he added.
Trying to negotiate in Washington has also been a challenge.
“I’ve reached out to endless governors and senators and congresspeople, Republican and Democrat,” Ford told the Toronto forum.
“Not one of them, behind closed doors, agree that attacking their closest friends and allies is beneficial to Americans. I guess (Trump) put a fear of God in these people.”
Asked about Trump’s Wednesday comment that Canada “works great” as a US state, Ford said the president’s volatility has been trying.
“Sometimes I think the cheese slips off the cracker with this guy. He wakes up in the morning, and even most people around him are not sure what he’s going to do.”
