You can’t get much by Donald Trump. He’s the one who likes to have all the negotiating power.
That’s why Trump walked away from a big trade deal after a foreign nation tried to play a fast one.
Trump Halts Canada Trade Talks, Signals Robust Tariff Strategy
President Donald Trump has taken a decisive stand against Canada, abruptly ending trade negotiations in response to Ottawa’s new digital services tax targeting American tech giants. The move, announced Friday on Truth Social, marks an escalation in the administration’s aggressive trade policy, aimed at protecting U.S. economic interests and asserting dominance in global markets.
“We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country,” Trump declared. The president accused Canada of mimicking the European Union’s similar tax policies, which he noted are also under scrutiny by his administration.
“They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also,” he continued. “Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period. Thank you for your attention to this matter!”
The decision comes despite expectations that Canada’s leadership change from Justin Trudeau to Prime Minister Mark Carney might have eased bilateral tensions. However, Trump’s firm stance suggests he is prepared to negotiate from a position of strength, prioritizing American interests over diplomatic niceties.
The administration’stariff strategy has kept global markets on edge since Trump’s “Liberation Day” tariffs were announced. These tariffs, initially set as high as 40% on goods from nearly every country, were temporarily scaled back to 10% during a 90-day pause starting April 2. With that pause set to expire on July 9, the administration is racing to secure individual trade deals to stabilize economic relations.
Amid this uncertainty, the White House has shared progress on a significant tariff-related understanding with China. On Thursday, Trump announced at a White House event, “We just signed with China yesterday, right? Just signed with China.” While initial reports suggested a comprehensive tariff deal, officials clarified that the agreement focuses on rare earth minerals, critical for tech and aerospace industries.
A White House official, speaking anonymously to NPR, explained, “The Administration and China agreed to an additional understanding for a framework to implement” an earlier Geneva agreement. The official emphasized that the deal centers on China’s export of rare earths, with Commerce Secretary Howard Lutnick confirming on Bloomberg TV that China would “deliver rare earths to us.” He added, “we’ll take down our countermeasures,” indicating a targeted de-escalation in trade tensions.
China’s Ministry of Commerce echoed this sentiment, stating, “China will, in accordance with the law, review and approve eligible export applications for controlled items.” They added, “In turn, the United States will lift a series of restrictive measures it had imposed on China.” This framework, established after months of turbulent tariff negotiations, offers a glimmer of stability in U.S.-China trade relations.
The U.S. and China had previously reached a temporary deal in Geneva last month, reducing U.S. tariffs on Chinese goods to 30% with an August 12 deadline for a more permanent agreement. This followed a period where tariffs on Chinese goods had soared to 145%, rattling global markets and raising costs for American consumers on products like car seats and clothing. American farmers also faced challenges as Chinese buyers turned to cheaper alternatives.
The administration’s tariff policies have created a complex landscape for global trade. Trump’s April announcement of sweeping tariffs, followed by the 90-day pause, set the stage for intense negotiations. While a deal with the UK was finalized at the G7 summit, other agreements remain in progress. Commerce Secretary Lutnick expressed optimism on Bloomberg, noting that the U.S. is close to securing tariff deals with 10 major trading partners.
Treasury Secretary Scott Bessent reinforced this timeline on Fox Business, stating, “Secretary Lutnick said yesterday that he expects 10 more deals, so, if we can ink 10 or 12 of the important 18, there are another important 20 relationships, then I think we could have trade wrapped up by Labor Day.” This ambitious goal highlights the administration’s determination to reshape global trade dynamics in America’s favor.
The termination of Canada talks and the ongoing China negotiations illustrate Trump’s unyielding approach to trade. By swiftly addressing perceived slights, such as Canada’s digital services tax, and securing strategic deals like the rare earths framework with China, the administration is asserting economic strength. These actions aim to protect American industries while pressuring trading partners to align with U.S. interests.
As the July 9 deadline approaches, the White House views it as a flexible target, with Bessent suggesting that major deals could extend to Labor Day. This strategy allows the administration to maintain leverage while pursuing agreements that prioritize American workers and businesses. The global economic landscape remains uncertain, but Trump’s decisive moves signal a clear intent to dominate trade negotiations.
