‘It’s All Going to Be OK’: Canada’s U.S. Ambassador Plays Down CUSMA Panic as Trump Tariffs Remain

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At a moment when every remark from Washington can rattle Canadian factories, markets and boardrooms, Canada’s new ambassador to the United States is urging the country not to confuse a scheduled trade review with an approaching economic cliff. Speaking in Toronto, Mark Wiseman told a business audience to take a deep breath and insisted that “it’s all going to be OK.”

His message was deliberately calming: discussions with the Trump administration have been serious, informed and respectful. Yet the reassurance arrives alongside a harder reality. President Donald Trump has questioned whether the North American trade pact should continue, U.S. officials say key tariffs are likely to remain, and Canadian steel, aluminum and auto producers are still absorbing the consequences.

Wiseman Tries to Lower the Temperature

Wiseman opened his Canadian Club Toronto appearance by addressing the anxiety surrounding the July 1 CUSMA review. Rather than treating the date as a deadline for the agreement’s survival, he framed it as one stage in a much longer process. He also described private conversations with U.S. officials as rational, collaborative and businesslike—a striking contrast with the confrontational language that has often dominated public discussion of Canada-U.S. trade.

That contrast is part of the ambassador’s job. Public threats can move markets, delay investments and encourage companies to prepare for the worst, even when negotiators are still exchanging proposals behind closed doors. Wiseman’s tone suggested Ottawa sees value in separating Trump’s negotiating rhetoric from the mechanics of the talks. The message was not that every dispute has disappeared. It was that officials are still talking, the agreement remains in force, and Canada has more room to negotiate than the most alarmist interpretations of July 1 imply.

July 1 Is a Review, Not CUSMA’s Expiry Date

CUSMA entered into force on July 1, 2020, with a 16-year term. That means the agreement is currently scheduled to continue until 2036, not terminate on the day of its first six-year review. The July 1, 2026 process gives Canada, the United States and Mexico an opportunity to assess how the pact is working and decide whether to extend its term by another 16 years, which would move the horizon to 2042.

If the three countries do not agree to an extension this year, CUSMA does not automatically collapse. Instead, annual reviews can continue through the remainder of the original term, giving the parties repeated opportunities to reach consensus. There is, however, an important caveat: any country can invoke the agreement’s separate withdrawal provision with six months’ notice. Wiseman’s point was that this exit power already exists and is not newly activated by the review. July 1 matters greatly for certainty, but it is not a trapdoor.

Trump’s Threats Still Carry Real Weight

Wiseman’s calm interpretation does not erase the political risk. Trump recently suggested the United States might not renew the pact and argued that America does not need its North American partners. U.S. Trade Representative Jamieson Greer has also said Washington intends to retain tariffs on imports from Canada and Mexico, while describing the administration’s disputes with Canada as more serious than routine trade irritants.

The process has added to Canadian unease. The United States and Mexico began formal bilateral negotiations over changes to automotive rules and other issues while Canada was initially left outside the room. That does not necessarily mean a trilateral agreement is doomed, but it creates the possibility that Washington and Mexico could settle key terms before presenting Canada with a narrower range of choices. Trump’s comments therefore cannot be dismissed as theatre. In trade negotiations, uncertainty itself becomes leverage, especially when companies must decide now where to place factories, source parts and commit capital for years.

Most Trade Is Protected, but the Pain Is Concentrated

The broad Canada-U.S. trading relationship remains more stable than the tariff headlines suggest. Federal estimates indicate that roughly 85 per cent of Canadian exports still enter the United States tariff-free, while the effective U.S. tariff rate across all Canadian exports is about 5.4 per cent. CUSMA compliance has protected a large majority of shipments from the wider tariffs applied to non-qualifying Canadian goods.

The damage is concentrated in industries that carry outsized economic and political importance. U.S. Section 232 measures impose steep duties on steel and aluminum, while automotive tariffs apply to imported vehicles and components under rules that place particular pressure on non-U.S. content. Canada, in turn, has kept counter-tariffs on U.S. steel, aluminum and automobiles even after removing many broader retaliatory measures in 2025. For a company selling specialized metal, a transmission component or an assembled vehicle across the border, an economy-wide average offers little comfort. A relatively narrow tariff can still reshape an entire order book.

Canada’s Dependence on the U.S. Has Not Disappeared

CUSMA matters because the cross-border economy is built around daily repetition: trucks clearing customs, energy moving through pipelines, components arriving at assembly plants and food products reaching stores on schedule. Canada and the United States exchanged nearly $3.6 billion in goods and services per day in 2024, and bilateral trade had increased by more than 27 per cent since CUSMA came into force.

Canada has made progress diversifying, but the U.S. still accounted for 71.7 per cent of Canadian goods exports in 2025. That share was the lowest since the early 1980s, yet it remains large enough to shape investment decisions across the country. A parts maker in southern Ontario cannot quickly replace a Detroit customer with one in Europe, just as a U.S. manufacturer cannot instantly reproduce a Canadian supplier’s capacity. The relationship is unequal in scale, but deeply interdependent in practice. That is why preserving predictable access matters almost as much as the tariff rate itself.

Autos Are Emerging as the Hardest Battleground

The automotive rules under CUSMA already require about 75 per cent of a qualifying vehicle’s value to come from North America. Passenger vehicles must also satisfy a high-wage content requirement of 40 per cent, rising to 45 per cent for pickup trucks. Those rules were designed to keep more production inside the region while supporting higher-paid manufacturing jobs in the United States and Canada.

The Trump administration has pushed a much more aggressive proposal in talks with Mexico: an 82 per cent regional-content threshold, with 50 per cent of a vehicle’s value produced specifically in the United States. People familiar with the proposal said it did not include a mechanism for counting Canadian content toward that U.S.-specific target. Major auto groups representing automakers, dealers and suppliers have warned that fragmenting CUSMA into separate bilateral systems would increase complexity and weaken integrated supply chains. Their concern is practical. A vehicle can cross the border several times during production, so rules that privilege one country’s content can disrupt plants in all three.

Ottawa Is Pursuing More Than One Track

Canada’s negotiating structure reflects the scale of the challenge. Janice Charette, a former clerk of the Privy Council and former high commissioner to the United Kingdom, was appointed chief trade negotiator to work alongside Wiseman. Trade Minister Dominic LeBlanc and Charette have presented proposals to U.S. officials, while Canada has formally recommended extending the trilateral agreement for another 16 years.

Ottawa is also treating sectoral tariffs as a parallel negotiation rather than assuming a CUSMA extension will automatically remove them. LeBlanc has said bilateral arrangements between Canada and the United States, and between the United States and Mexico, could sit beside the trilateral framework if they solve shared problems. At the same time, the Carney government is expanding ties elsewhere. In 2025, Canadian goods and services exports to non-U.S. markets grew 11.2 per cent while exports to the United States fell 3.8 per cent. Diversification strengthens Canada’s hand, but it cannot quickly replace continental trade.

Reassurance Does Not Mean the Risk Is Gone

The economic evidence explains why businesses remain uneasy despite Wiseman’s confidence. Statistics Canada found that three in ten manufacturing businesses reported a major negative impact from U.S. tariffs in the fourth quarter of 2025, while one in five manufacturers planned to delay investments or expenditures. By December, output at aluminum producers was down 19.5 per cent from a year earlier, and steel-mill output remained below its late-2024 level.

The Bank of Canada has also said tariffs and trade uncertainty have placed economic activity on a lower path than before the restrictions were imposed, with the future of the North American relationship remaining a major risk. Wiseman is therefore right about the calendar: CUSMA is not scheduled to vanish on July 1. But Canadian anxiety is not based only on a misunderstood date. It is based on tariffs already being paid, investments already being postponed and proposals that could shift production south. The most realistic reading is neither panic nor complacency—Canada has time, but not time to waste.

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