Carney accelerates talks with Trump to reach economic-security deal within 30 days

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Mark Carney and Donald Trump have agreed to negotiate with the aim of striking “within the coming 30 days” an economic and security deal that would end the Canada-U.S. trade war, the Prime Minister’s Office says.

The commitment followed a 70-minute meeting between Mr. Carney and the U.S. President at the Group of Seven summit in Canada’s Rocky Mountains.

Further Canada-U.S. talks are scheduled for later this week, after the global meeting is over, Dominic LeBlanc, the federal minister responsible for Canada-U.S. relations, told reporters.

Later Monday, the White House announced Mr. Trump would quit the G7 meeting early and return to Washington after the summit leaders’ dinner, citing the conflict between Israel and Iran.

This early departure, which echoes what Mr. Trump did in 2018 when Canada last played host to the G7, ensures that the U.S. leader, who has embraced and praised Russian President Vladimir Putin, will not have to take part in a working session Tuesday that deals with Moscow’s illegal war on Ukraine.

The Prime Minister told reporters he understands why the U.S. President had to quit the G7 summit early. “I am very grateful for the President’s presence and I fully understand why he is leaving,” Mr. Carney said of Mr. Trump’s departure.

Mr. Carney’s office, in a statement at the G7, said he and Mr. Trump on Monday discussed “immediate trade pressures and priorities for each country’s workers and businesses, and shared updates on key issues raised in negotiations on a new economic and security relationship between Canada and the U.S.”

To that end, the Prime Minister’s Office said, the pair “agreed to pursue negotiations toward a deal within the coming 30 days.”

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It’s the first time Mr. Carney has set a deadline for wrapping up negotiations in the three-month Canada-U.S. trade war. Parties to such talks do not always place such restrictions on themselves, because they want the flexibility to walk away from a weak deal.

Mr. Carney and Mr. Trump also talked about “collaboration on further shared priorities at the summit, such as critical minerals, gun and drug smuggling, illegal drugs, and border security” as well as co-operation on defence.

“The leaders agreed to remain in regular contact at the G7 Leaders’ Summit and in the weeks ahead, including as NATO leaders convene next week.”

Mr. LeBlanc said the Carney-Trump tête-à-tête was “long and substantive” but he declined to reveal details, including whether Mr. Trump had revived talk of annexing Canada. “We’re not going to go into the private details of the conversation.”

The G7, which was formed in the 1970s in response to challenges such as the oil crisis, is this year serving another purpose: It’s providing leading industrialized countries an opportunity to sit down and negotiate with Mr. Trump in hopes of avoiding punishing tariffs he has threatened against all major trading partners.

Mr. Trump, who wore a lapel pin featuring the flags of the United States and Canada on Monday, said he doesn’t think there are tremendous obstacles to a deal with Canada.

“I think we have different concepts. I have a tariff concept. Mark has a different concept, which is something that some people like, but we’re going to see if we can get to the bottom of it today,” Mr. Trump said.

“I’m a tariff person. I’ve always been a tariff person. It’s simple, it’s easy, it’s precise, and it just goes very quickly. And I think Mark has a more complex idea, but also very good – so we’re going to look at both, and we’re going to see what we’re going to come out with.”

Mr. LeBlanc and Kirsten Hillman, the Canadian ambassador to the United States, declined to explain Mr. Trump’s “complex idea” comment, saying they had agreed with the U.S. not to reveal the substance of deliberations.

Brian Clow, who served as deputy chief of staff to former prime minister Justin Trudeau and was among the leading officials on Canada-U.S. relations for more than eight years, said he thinks that Mr. Trump so far in talks wants to keep a residual tariff in place on Canadian imports and Ottawa is resisting this.

“My impression is Canadians continue to push to bring tariff levels back to where they were in January before Trump returned to office, and the Americans have not yet stated clearly that they’re willing to do that – at least not based on whatever it is the Canadians have put on the table,” Mr. Clow said.

A deal between the White House and Britain in May ended Mr. Trump’s threat of big levies on British goods but left a residual tariff of 10 per cent on imports from that country.

Asked Monday whether Canada would accept a permanent new U.S. baseline tariff on Canadian goods, Ms. Hillman, the envoy, told reporters that Ottawa would not. “Our position is that we should have no tariffs on Canadian exports to the United States.”

Mr. Clow said his impression was that the extra military spending that Mr. Carney announced last week to meet a NATO defence-expenditure target was also aimed at assuaging U.S. concerns about Canada’s commitment to security. But, he noted, that doesn’t appear to have been sufficient.

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The U.S. has complained about Canada’s digital-services tax and its barriers to dairy imports, among other things.

The Americans “want further concessions from Canada on other trade issues, and that’s part of why a deal has not landed,” Mr. Clow said.

Separately on Monday, Mr. Trump voiced his continued unhappiness that the diplomatic and economic forum had ousted Russia from its ranks and said the group should consider expanding to include China. “It’s not a bad idea,” he said of China joining the G7.

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Mr. Trump falsely claimed in comments to reporters Monday that Russia was expelled from the G7, formerly the Group of Eight, in part on the initiative of former prime minister Justin Trudeau. In fact, Russia was removed from the G7 when former prime minister Stephen Harper was in office.

“I think you wouldn’t have a war right now if you had Russia in,” the President said of Moscow’s all-out assault on Ukraine, which began in 2022.

As he negotiates with Canada, Mr. Trump also has his own voters to reckon with. Last year, a Pew Research poll showed that nearly 60 per cent of U.S. voters believe their country has lost more than it has gained from increased trade with other countries – a number that includes roughly three in four Republicans, but also nearly one in two Democrats.

The White House, too, remains locked in trade negotiations with much of the world, talks that provide additional incentive for the Trump administration not to cut Canada a favourable deal that other countries could then seek to replicate.

Mr. Carney has instead sought to strike a grand bargain that links trade and security issues.

”From Day 1, Carney and his team have been pitching security and defence co-operation in return for trade access with insistence that existing trade agreements are valid legal documents,” said Jeremy Paltiel, a professor of political science at Carleton University.

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The current U.S. levies include tariffs on Canadian steel and aluminum, which doubled to 50 per cent earlier this month. There’s also a 25-per-cent tariff on Canadian-made vehicles, which applies to the non-U.S. content in those cars and light trucks. For goods that don’t comply with United States-Mexico-Canada Agreement rules of origin, there is a 25-per-cent tariff – which drops to 10 per cent on critical minerals, energy and potash.

Canada, in response, has imposed retaliatory tariffs on imports from the U.S.

The talks on a new economic and security agreement between Canada and the U.S. could amount to a first phase, with the second phase being the renegotiation of the USMCA already scheduled for 2026.

Topics Canada and the U.S. are talking about include working together to counter China’s unfair trade practices, a discussion that could affect U.S. tariffs on Canadian steel and aluminum, and further border-security arrangements to stop the illegal distribution of the opioid fentanyl.

The U.S. also wants Canada to take a greater role in securing the Arctic and join Mr. Trump’s ambitious Golden Dome missile shield – a project that Mr. Carney has publicly said would make sense for Canada.