Prime Minister Justin Trudeau spoke to U.S. President Donald Trump early Monday morning about the forthcoming trade war that has the potential to inflict economic pain on workers and businesses on both sides of the border — and they are expected to speak again later today.
The Prime Minister’s Office and the White House did not immediately release a readout of what was said on the call, but a spokesperson for Trudeau told CBC News they “spoke about trade and the border” and confirmed they will connect again this afternoon before tariffs are set to take effect on Tuesday.
Speaking to reporters in the Oval Office after the first call, Trump said he had a “good talk” with the prime minister.
He said Canada is “very tough” and “we’re not treated well by Canada and we have to be treated well.”
He claimed Canada “doesn’t take our agricultural products, for the most part.” It’s an outlandish statement because the U.S. is Canada’s largest agricultural trading partner, according to data from Trump’s own government, representing some 57 per cent of Canadian food imports.
Trump said he asked Trudeau “a couple of questions” and the prime minister will report back in the afternoon.
The president has said for weeks he would like Canada to join the United States as the 51st state. It’s a line he repeated again today, saying he would “love to see” Canada join the union. But he seemed to acknowledge it “would be a long shot,” saying some unnamed people “don’t have a threshold for pain.”
Asked in the Oval Office whether Canada could do anything that would pause tariffs, as has happened with Mexico, U.S. President Donald Trump repeated comments on wanting Canada to become the 51st state. Trump was speaking ahead of a planned call with Prime Minister Justin Trudeau at 3 p.m.
Trump came to a deal with Mexican President Claudia Sheinbaum earlier Monday.
Sheinbaum said in a social media post she had a “good conversation” with the president after she agreed to deploy 10,000 Mexican national guard troops to the U.S. border.
She said the “tariffs are paused for one month from now,” as a result of that commitment. A White House spokesperson confirmed to The Associated Press that Trump has agreed to “pause” his promised 25 per cent tariff on Mexican goods. Sheinbaum also said she would hold off on her threatened retaliatory tariffs on U.S. goods.
Mexico’s President Claudia Sheinbaum says American tariffs on her country have been delayed for a month after a conversation with U.S. President Donald Trump, a statement confirmed by the White House.
The Mexican pause added to the trade drama because Trump’s tariffs against Canada and China are still slated to go into effect.
After the news of Sheinbaum’s deal broke, some Conservative politicians in Canada called for the federal government to deploy the military to the Canada-U.S. border, which was almost entirely demilitarized after the War of 1812 more than 200 years ago.
Conservative Leader Pierre Poilievre asked Trudeau to “send Canadian Forces troops, helicopters and surveillance to the border now” to try and save the Canada-U.S. trade relationship and address Trump’s concerns about drugs and migrants.
He also called for the hiring of “at least” 2,000 more Canada Border Services Agency (CBSA) agents to bolster the law-enforcement agency that’s responsible for border control.
Saskatchewan Premier Scott Moe also asked the federal government to put the CBSA under military command to “address concerns President Trump has raised.”
The $2.6 billion Ottawa spends every year on CBSA could then be reclassified as military spending, helping the country chip away at its NATO commitment to spend two per cent of its GDP on defence, Moe said. Trump has repeatedly criticized Canada’s low defence spending.
The federal government already announced a bulked up $1.3 billion border plan in December to deploy more personnel and technology to better police the boundary. The government has also launched a fentanyl crackdown.
In a social media post after his call with Trudeau wrapped, Trump also chastised Canada for not allowing U.S. banks to “open or do business there.”
New focus: banking
Until this point, Trump has framed the tariffs as a way to hit back at Canada for the ongoing trade deficit and supposed inaction on drugs and migrants crossing the northern border into the U.S. — his stated concerns about banking fairness are a new development.
A number of American banks do business in Canada with large lending and commercial and investment banking operations, among other functions, on this side of the 49th parallel.
There are 16 U.S.-based bank subsidiaries and branches in Canada holding about $113 billion in assets, according to the Canadian Bankers Association.
Personal banking in Canada is largely the domain of Canadian-based banks, due to stringent federal regulations designed to protect against bank failures. According to government figures, Canada’s large banks hold more than 93 per cent of all domestic banking assets. Canadian banks are routinely ranked among the safest in the world.
The federal government announced retaliatory 25 per cent tariffs on U.S. goods — ranging from juice to appliances and cars — after President Donald Trump followed through on his tariff threats. The trade war has people being urged to buy Canadian as the scope of the economic fallout waits to be seen.
Last night, Trump also raised the Canadian banking system with reporters after landing back in D.C. after a weekend at his Florida estate.
“Canada’s been very abusive of the United States for many years. They don’t allow our banks. Did you know that? Canada does not allow banks to go in. If you think about it, that’s pretty amazing,” he said.
In his Monday social media post, Trump said the trade standoff is “also a DRUG WAR, and hundreds of thousands of people have died in the U.S. from drugs pouring through the Borders of Mexico and Canada.”
American government data that shows comparatively little amounts of fentanyl — the drug Trump has said he’s most concerned about — has been seized at the northern border in recent years.
Figures from U.S. Customs and Border Protection (CBP) show the agency seized 19.5 kilograms of fentanyl at the northern border last year, compared to 9,570 kilograms at the southwestern one.
Despite the apparent standoff over these issues, Trump said he will speak to Trudeau again at 3 p.m.
Trudeau is set to meet with the Council on Canada-U.S. Relations later today to discuss the pending trade war and the tariffs that are set to take effect Tuesday.
Trump launched the first salvo in this trade dispute when he announced Saturday he would slap a 25 per cent tariff on virtually all Canadian goods with a lower rate — 10 per cent — for the country’s energy products.
Trump said he was delivering on a campaign promise to seek retribution from countries he claims are “ripping off” the U.S.
Trump is fixated on the Canada-U.S. trade deficit, which is largely driven by American demand for cheaper Canadian oil. When oil exports are excluded, the Americans actually have a trade surplus with Canada, according to Canadian government data.
Trudeau has vowed to hit back and the federal government released a list of $155 billion worth of American goods that will face 25 per cent tariffs if Trump doesn’t back off.
Speaking to Canadians late Saturday night after Trump made the tariffs official, Trudeau said, after more than a century of friendship and collaboration through world wars and natural disasters and a whole host of shared challenges, Canada doesn’t want conflict with the U.S.
“We don’t want to be here, we didn’t ask for this, but we will not back down,” he said. “We will not back down in standing up both for Canadians and for the incredible, successful relationship and partnership between Canada and the United States.”