US President Donald Trump said on Wednesday that the United States and Canada had reached a “very fair” trade agreement under which exports by US farmers and businesses to Canada would face no tariffs. “We have no tariffs going into Canada,” Trump told reporters, adding that tariffs on farmers would be “non-existent”.
The announcement followed a three-day pause on 50 percent tariffs that had been scheduled to take effect on Wednesday. Trump said the pause was based on a deal being reached, subject to the finalisation of documents, while Canadian Prime Minister Mark Carney said substantial progress had been made but important work remained.
What has been announced
Neither US nor Canadian officials has confirmed the full details of the agreement. Trump’s statement establishes his position on the proposed terms, but the deal’s final documentation and scope have not yet been publicly confirmed by both governments.
The threatened tariffs would have covered about $20bn worth of imports and applied to goods even when they qualified for preferential treatment under the US-Mexico-Canada trade agreement. The announced arrangement, as described by Trump, would remove tariffs on US exports to Canada, including farm and business shipments.
Related coverage: Canadian PM Carney and US President Trump Commit to Strengthen Trade Negotiations.
Why the auto sector matters
The auto sector has been a central sticking point in the negotiations. On Monday, US and Canadian officials discussed reducing US Section 232 tariffs on Canadian vehicles from 25 percent to 15 percent, with further reductions tied to the amount of US content in each vehicle.
Section 232 tariffs are imposed after a US Commerce Department investigation determines that imports threaten US national security. The discussions indicate that vehicle tariffs were among the issues still requiring agreement as the documents were finalised.
What happens next
Trump’s three-day pause was announced late Tuesday after what he described as a good conversation with Carney. The pause delayed the threatened 50 percent tariffs while Washington and Ottawa continued negotiations.
More context: New US Tariffs May Be Imposed as Existing Trade Duties Near Expiration.
Carney’s statement that important work remained means the agreement was not presented as fully settled by both sides. The final terms, including how the auto provisions would operate, remain subject to further confirmation.
Also read: Canada faces a Wednesday deadline to stop new US tariffs.
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