Canada spoke with Trump official to reassure U.S. that free trade deal with Beijing not in the works

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The Canadian government spoke with a key Trump administration official on Sunday to assure Washington that Ottawa is not preparing to sign a comprehensive trade agreement with Beijing, after threats from U.S. President Donald Trump that he would impose 100-per-cent tariffs if a pact were ever struck.

Dominic LeBlanc, the minister responsible for Canada-U.S. trade, told reporters Monday he had a “cordial and lengthy conversation” with U.S. Trade Representative Jamieson Greer in which, he said, they discussed the commitment Ottawa made in the United States-Mexico-Canada Agreement “not to enter into free trade discussions with countries that do not have a market economy.”

“That was a commitment that Canada made to our free-trade partners, the United States and Mexico six years ago, and I reiterated that remains our position,” Mr. LeBlanc added.

Mr. Trump on Saturday threatened steep tariffs on Canada if it cuts a trade agreement with China, warning this would result in Canadian territory being a transit point for shipping Chinese goods into the United States.

This was a 180-degree reversal from comments he made on Jan. 16, in which he praised Prime Minister Mark Carney for a tariff-reduction pact with Beijing and said the Canadian leader should be making deals if he can.

The Canadian government has been working to contain a rift with the Trump White House after Mr. Carney’s provocative Jan. 20 World Economic Forum speech in Davos, Switzerland, that amounted to a veiled attack on the damage the U.S. President has done to the international rules-based order.

Mr. LeBlanc said he told Mr. Greer that the agreement with China, reached on Jan. 16 during Mr. Carney’s trip to Beijing, does not amount to a breach of the USMCA.

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The minister said he believes Mr. Greer “understood very well that we have a narrow trade arrangement that deals with a few sectors of our economy - that deals principally with a few sectors of our economy that had seen tariffs on both sides in the last couple of years.”

He noted it was not dissimilar to a deal the United States struck with Beijing last year, under which China agreed to resume purchases of U.S. soybeans.

The minister’s office in Ottawa declined to say which party initiated the telephone call between Mr. LeBlanc and Mr. Greer Sunday.

Mr. LeBlanc said he agreed to travel to Washington in the next few weeks to discuss a coming mandatory review of the USMCA. He declined to say whether he obtained any assurances from Mr. Greer that the threat of 100-per-cent tariffs is over.

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Mr. Carney said he expects the 2026 review of the continental trade pact with the U.S. will be intensive, and played down Mr. Trump’s latest tariff threats as part of the negotiating process.

“We are entering, soon, a negotiation, or review, formally,” of the USMCA and “it will be a robust review,” Mr. Carney said Monday at a press conference. “The President is a strong negotiator. And I think some of these comments and positioning should be viewed in the broader context of that.”

Mr. Carney told reporters he has no intention of starting comprehensive trade negotiations with China.

Mr. Trump wrote Saturday on Truth Social that “[if] Governor Carney thinks he is going to make Canada a ‘Drop Off Port’ for China to send goods and products into the United States, he is sorely mistaken,” using belittling language that cast the Prime Minister as state governor instead of the leader of a sovereign country.

In remarks last week at Davos a day after Mr. Carney’s speech to the World Economic Forum, the President suggested Canada is ungrateful for the benefits it derives from relations with the United States.

“Canada gets a lot of freebies from us, by the way. They should be grateful. But they’re not,” Mr. Trump said. “I watched your Prime Minister yesterday – he wasn’t so grateful.”

Canada, the United States and Mexico have begun the review of their trilateral trade deal. Each party will have to decide whether to extend the USMCA for another 16 years or signal its intent to withdraw. Mr. Trump is widely expected to demand changes to the deal that will force a renegotiation.

Some trade experts say they expect the U.S. will seek to place more restrictions on Canada’s ability to sign trade agreements with China.

The deal with Beijing that Mr. Carney struck during his China trip includes a “strategic partnership” to boost ties and allow Chinese investors to play a larger role in Canada’s economy. During the four-day visit, Mr. Carney praised China as a more predictable trading partner than the U.S. and broke with Washington by lowering tariffs on Chinese-made electric vehicles.

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Mr. Carney said he would have given the U.S. notice under the terms of the USMCA if Ottawa intended to negotiate a free-trade deal with China.

Meanwhile, Ontario Premier Doug Ford said that he remained at odds with Mr. Carney over his move to ease Chinese EV tariffs but said the two leaders agreed on many other matters after a meeting Monday at the Premier’s home in Toronto.

After a 45-minute meeting, the pair appeared at a nearby Pizza Nova at lunchtime and spoke briefly with a reporter from The Canadian Press, who asked whether they had resolved their differences.

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“We never had a problem,” a smiling Mr. Ford said. “Listen guys, we’re a big family. And sometimes brothers and sisters may disagree. But at the end of the day, make no mistake about it, we are one country, we are Team Canada, both of us.”

Mr. Ford acknowledged that the pair still disagree about the China deal but said they are on the same page about getting major projects built faster.

Federal Industry Minister Mélanie Joly, who met with Mr. Ford, said she had struck an Ontario-Ottawa task force on the auto industry as she prepared to unveil a new auto sector strategy in the coming weeks.

Ms. Joly said her coming auto strategy would address “what we do with foreign direct investment, including from China.” She said it would include unspecified levers for provincial and federal governments to protect auto jobs. She also said the China EV agreement will include conditions, which she did not detail, and which she said would be revealed at a later date.

Ms. Joly also addressed Mr. Ford’s concerns, voiced last week, that Chinese EVs could act as “spy cars,” saying that the federal government would not jeopardize the security of Canadians.