The federal government has assured a senior U.S. trade official that Canada is not preparing to negotiate a comprehensive free-trade agreement with China, moving to defuse escalating tensions after U.S. President Donald Trump threatened sweeping tariffs on Canadian goods.
Canada–U.S. Trade Minister Dominic LeBlanc said he held a “cordial and lengthy” conversation Sunday with U.S. Trade Representative Jamieson Greer, during which he reiterated Canada’s commitment under the United States-Mexico-Canada Agreement not to pursue free-trade talks with non-market economies.
“That was a commitment Canada made to our free-trade partners six years ago, and it remains our position,” LeBlanc told reporters Monday.
Trump warned over the weekend that he would impose 100-per-cent tariffs on Canada if Ottawa were to sign a trade pact with Beijing, arguing such a deal could turn Canada into a conduit for Chinese goods entering the United States. The threat marked a sharp reversal from Trump’s comments earlier this month, when he praised Prime Minister Mark Carney for reaching a limited tariff-reduction arrangement with China.
LeBlanc said the Jan. 16 agreement reached during Carney’s visit to Beijing does not violate the USMCA, describing it as a narrow sector-specific arrangement addressing retaliatory tariffs that had affected both countries in recent years. He compared it to a similar, limited trade understanding previously reached between Washington and Beijing involving U.S. soybean exports.
The federal government has been working to manage strained relations with the White House following Carney’s World Economic Forum speech in Davos last week, which criticized the erosion of the global rules-based order — remarks widely interpreted as a rebuke of U.S. trade policy.
LeBlanc said he plans to travel to Washington in the coming weeks ahead of the mandatory 2026 review of the USMCA, though he would not say whether the tariff threat has been withdrawn.
Carney, speaking Monday, said the upcoming review of the continental trade pact will be intensive but downplayed Trump’s comments as part of a negotiating strategy. He stressed again that Canada has no intention of launching comprehensive free-trade negotiations with China and said the U.S. would be formally notified under USMCA rules if Ottawa ever planned to do so.
Trump, meanwhile, continued to criticize Carney publicly, referring to him as “governor” in a Truth Social post and accusing Canada of acting ungratefully toward the United States.
The USMCA review will require Canada, the U.S. and Mexico to decide whether to extend the agreement for another 16 years or trigger a renegotiation — a process many trade experts expect Trump to use to push for tighter restrictions on Canada’s dealings with China.
The limited China deal announced by Carney includes a broader “strategic partnership” aimed at deepening economic ties and easing tariffs, including on Chinese-made electric vehicles. Carney has described China as a more predictable trading partner than the U.S., comments that have further unsettled Washington.
In Ontario, Premier Doug Ford said he remains opposed to easing tariffs on Chinese electric vehicles but struck a conciliatory tone after meeting with Carney on Monday. “We are one country. We are Team Canada,” Ford said, while acknowledging ongoing disagreements over China policy.
Industry Minister Mélanie Joly said Ottawa is preparing to unveil a new auto-sector strategy in the coming weeks, including safeguards related to foreign investment and conditions attached to Chinese EV imports. She added that the federal government would not compromise Canadian security or auto-sector jobs.
