Experts doubt new Canada-US trade deal can be reached in 30 days

Canadian Prime Minister Mark Carney said during the G7 summit that he and US President Donald Trump aim to reach a new trade agreement within 30 days — a goal experts say is unlikely to succeed.

"To have a full new trade agreement to replace CUSMA in 30 days? It's not achievable," said Julian Karaguesian, an economics professor at McGill University.

"Unless Carney convinces Trump to keep the arrangement with a few small changes, I don't see how they could do it," he told China Daily.

Karaguesian, who served as a special adviser in the international trade and finance branch at the Canadian Ministry of Finance, said trade agreements are notoriously complex and time-consuming.

"There are teams of people, and so many details to work out," he said. "Trump says he wants to make a lot of changes," he said.

The biggest obstacle, he said, is the auto sector. "President Trump has been consistent that he wants to bring back automobile production to the United States," Karaguesian said.

"As soon as Trump left the G7 meeting and was back in the US, he remarked, ‘Why should we be making automobiles in Canada?'" he said.

He predicted that Washington would keep its steel tariffs and possibly remove the aluminum ones, but the more fundamental shift could come in the form of a baseline US tariff.

"I think there's going to be a 10 percent minimum tariff," he said. "That means the trade agreement as we knew it — CUSMA — is over, or at least fundamentally altered."

Despite this, Karaguesian said he believes Ottawa might still negotiate if it can secure protections for the auto industry.

"If Carney can get an agreement to maintain free trade in automobiles, they might be willing to make concessions — even accepting a 10 percent tariff on other exports," he said. "The industrial heartland of the country depends on it."

However, he is skeptical the Trump administration would offer much flexibility. "Trump said, ‘I'm a tariff guy, and we're going to have tariffs.' He's been saying that consistently," Karaguesian said.

Beyond tariffs, Karaguesian said that Canada should prepare for other demands — particularly regarding critical minerals.

"I think Trump is going to demand special and maybe exclusive access to Canada's undeveloped critical minerals," he said, adding that such demands could be aimed at keeping out China, Europe and other competitors.

Carney announced on June 19 that Canada would revise its retaliatory tariffs on steel and aluminum by July 21. Karaguesian viewed that move as largely symbolic.

"I think he's trying to do something, but I don't think that's going to have any effect on Trump," he said. "It might even backfire."

In his view, the US under Trump is targeting its allies. "They're pressuring their allies to close the gates to the rest of the world in Europe and North America," he said.

Canada should be prepared for tough demands and limited trust, according to an expert on Canadian history.

"On the surface, the 30-day limit seems a bit odd, but Donald Trump likes to set short periods for negotiations," said Ron Stagg, a professor at Toronto Metropolitan University, who focuses on Canada-US relationship.

"He does not like negotiations to drag on. Whether Carney or Trump sets the time limit, it conforms to what Trump likes," he told China Daily.

While the timeline might be intended to accelerate discussions, Stagg said that the US side, particularly under Trump's leadership, will likely bring more confrontation than compromise.

"The biggest obstacle is Trump's belief that Canada is ‘ripping off' the United States in trade and in defense," he said.

"He will be insisting on some compensation, perhaps in defense spending, or increased purchases from the United States or reduced tariffs on American goods," he said.

Carney is expected to focus on rolling back tariffs on Canadian steel and aluminum exports, but Stagg said that Trump will likely broaden the scope.

"Aluminum, steel and cars are the main areas where Carney will focus, but I am sure that he realizes that Canada will have to give something in return," he said. "Trump will likely introduce other tariff issues, dairy quotas for instance."

"He may even introduce entirely new issues. Certainly, trade and tariffs will be central," he said.

Carney's recent announcement that Canada will revise its retaliatory tariffs on steel and aluminum by July 21 is widely seen as a warning shot to Washington. But Stagg said the move is more about posturing than escalation.

"Mark Carney is displaying strength by threatening more tariffs, but (he) really wants to find a middle ground in negotiations," Stagg said. "He understands that Trump sees weakness as something that he can exploit."

Ottawa's ongoing outreach to Europe and China has raised questions about whether Canada is trying to gain leverage with the US by broadening its trade ties.

"I do not believe that looking to Asia and Europe for increased trade is part of his bargaining strategy," he said. "The Canadian government truly believes that the United States is no longer a trustworthy trade partner."

While Canada cannot quickly shift a large portion of its trade elsewhere, Stagg said diversification is still critical.

"Canada can reduce the dependence on our southern neighbor, so that any future trade dispute with the United States does not hurt as much," he said.