U.S. Trade Chief Says Canada Still Hasn’t Accepted That Trump’s Tariffs Are Staying

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A blunt message from Washington has put Canada’s trade strategy under fresh pressure: the tariff fight may not be a temporary storm to wait out. U.S. Trade Representative Jamieson Greer says the Trump administration intends to keep tariffs in place even for Canada and Mexico, despite the North American trade pact that was supposed to protect much of the continent’s commerce.

For Canadian exporters, manufacturers, farmers, auto workers, and provincial governments, the warning lands at a sensitive moment. The Canada-U.S.-Mexico Agreement is heading into a major 2026 review, and Ottawa is trying to preserve stable access to its most important market. But Greer’s comments suggest Washington sees tariffs not as a bargaining chip to remove, but as a new baseline Canada has yet to accept.

Washington Is Sending Canada a Harder Message

Greer’s latest comments were not framed as a minor trade complaint. He said the United States expects tariffs to remain part of its trade policy, even with countries inside North America’s shared trade framework. That matters because Canada has spent much of the past year trying to separate the idea of CUSMA from the tariff war, arguing that the agreement should preserve predictable market access for Canadian businesses.

The message from Washington is more complicated. Greer said most countries have “begrudgingly” accepted that tariffs are now part of the Trump administration’s approach, but he described Canada as being in a “different spot.” That phrasing is important. It signals that the United States does not simply see Canada as a negotiating partner with disputes to resolve. It sees Ottawa as a country still resisting the basic premise of Trump’s trade policy: that tariffs can remain even after a deal is updated.

Tariffs Are Being Treated as a Permanent Tool

For years, Canadian officials and businesses tended to see tariffs as temporary shocks. The usual playbook was to respond, negotiate, wait for political pressure to build in the United States, and eventually push toward a settlement. Greer’s comments challenge that assumption. He said the U.S. would have tariffs as long as it has large trade deficits, making the issue sound less like a short-term punishment and more like a standing feature of American trade policy.

That shift changes the negotiation. If tariffs are no longer treated as temporary leverage, Canada cannot simply ask for a return to the pre-tariff status quo. It has to negotiate inside a new environment where Washington may offer exemptions, carve-outs, or preferred treatment, but not necessarily full tariff-free access. For companies that built supply chains around the old North American model, that means legal compliance with CUSMA may no longer be enough to guarantee cost certainty.

Canada’s Retaliation Has Become a Sticking Point

One reason Canada is being singled out is its decision to retaliate. Ottawa has imposed countermeasures in response to U.S. tariffs, especially around steel, aluminum, and automobiles. Canada later removed some counter-tariffs on U.S. goods, but it kept measures in place on key sectors. From Ottawa’s perspective, retaliation was a way to defend Canadian workers and pressure Washington to return to fair trade.

Greer appears to view that differently. He pointed to Canada’s retaliation as one of the reasons the relationship is harder to resolve, comparing Canada’s posture with countries that have accepted U.S. tariff rates and continued talks. That creates a difficult political bind for Ottawa. Dropping countermeasures could look like surrender. Keeping them may satisfy domestic pressure, but it also gives Washington a reason to argue that Canada has not accepted the new rules of engagement.

CUSMA Is Still a Shield, But Not a Full Protection

CUSMA still matters enormously. Many Canadian goods that qualify under the agreement remain protected from the broadest U.S. tariff measures. Canada’s trade commissioner service has continued to stress the importance of CUSMA compliance, including rules of origin and proper documentation. For exporters, paperwork that once looked routine has become a financial defence line.

But Greer’s comments show the shield has limits. Sector-specific tariffs on steel, aluminum, automobiles, and other sensitive goods can still apply outside the basic CUSMA preference system. That is why businesses are nervous. A product may be North American in origin, but still face pressure if it falls into a sector Washington treats as strategic. The result is a trade system that looks less like free trade and more like conditional access, where qualifying under the pact is necessary but not always sufficient.

The Auto Sector Is at the Centre of the Fight

The auto industry is one of the clearest examples of why this dispute is so sensitive. Canada and the United States do not just trade finished vehicles; they share an industrial system. Parts, components, engineering, steel, aluminum, and assembly capacity are spread across the continent. Plants in Ontario, Michigan, Ohio, and Mexico are linked by supply chains that were designed for efficiency, not repeated tariff shocks.

That is why Greer’s comment about wanting cars built in the United States hits a nerve in Canada. Automotive production in Canada is not a side issue. It supports communities in southern Ontario, anchors suppliers, and affects dealership inventories and consumer prices across North America. If Washington tries to rewrite rules of origin to push more production south, Canada may face pressure not only on exports, but on future investment decisions by global automakers.

Steel, Aluminum, Lumber, and Cabinets Show the Wider Risk

The tariff problem is not limited to cars. Canadian officials have identified U.S. measures affecting steel, aluminum, automobiles, and softwood lumber as key concerns heading into the CUSMA review. These are not abstract categories. They touch construction, manufacturing, energy infrastructure, homebuilding, packaging, mining supply chains, and small businesses that feed into larger exporters.

For a mid-sized manufacturer, the damage is rarely as simple as one tariff line. A steel input may become more expensive. A customer in the United States may delay an order. A bank may become more cautious about financing equipment. A buyer may ask for price concessions to offset tariff risk. That is why tariffs can spread through an economy even when only some goods are directly hit. The visible tax is only part of the cost; uncertainty becomes the larger burden.

Mexico’s Head Start Is a Warning for Ottawa

The United States has already moved ahead with formal talks involving Mexico, while talks with Canada have lagged behind. That does not mean Canada is being removed from the North American framework, but it does create pressure. If Washington and Mexico define early priorities around rules of origin, economic security, and regional content before Canada is fully at the table, Ottawa may find itself reacting to terms rather than shaping them.

Canada has tried to keep the process trilateral while accepting that some issues will be handled bilaterally. That is realistic, but risky. Mexico has its own interests, especially around manufacturing, nearshoring, and avoiding direct conflict with Washington. Canada’s challenge is to make sure North American integration does not gradually become a U.S.-Mexico conversation with Canada added later. In trade negotiations, timing is leverage, and being late can be costly.

Ottawa Is Trying to Coordinate at Home

Canada’s response is not only happening in Washington. Trade Minister Dominic LeBlanc has been meeting with provincial and territorial counterparts to coordinate Canada’s approach ahead of the CUSMA review. That matters because tariffs hit different regions in different ways. Ontario worries about autos and steel. Alberta watches energy and petrochemicals. British Columbia cares about ports, lumber, and Pacific trade. Quebec has aerospace, aluminum, and manufacturing exposure.

The political difficulty is that every province wants Canada to be firm, but not every province carries the same risks. A national strategy has to protect workers while keeping enough flexibility to negotiate. It also has to reassure businesses that Ottawa is not simply reacting headline by headline. The more Washington presents tariffs as permanent, the more Canada needs a long-term industrial and trade strategy rather than a short-term crisis response.

Canada’s U.S. Dependence Is Still the Core Weakness

Canada has made progress diversifying trade, but the United States remains by far its most important export market. Statistics Canada reported that the U.S. share of Canadian merchandise exports fell in 2025, yet it still accounted for more than 70 percent. That means even a partial loss of access, or a modest increase in costs, can have outsized effects on Canadian growth, jobs, and business confidence.

This is the hard reality behind Greer’s comments. Canada can retaliate, diversify, and argue that tariffs damage both sides, but it cannot quickly replace the U.S. market. Factories were built near the border for a reason. Pipelines, rail networks, trucking routes, and customer relationships point south. Diversification is important, but it takes years. Tariffs, by contrast, can change costs overnight. That imbalance gives Washington leverage even when U.S. consumers and businesses also feel pain.

Businesses Are Facing a Planning Problem

The biggest fear for many companies is not just today’s tariff rate. It is not knowing what the rules will look like six months from now. A manufacturer deciding whether to buy new equipment, expand a plant, or hire another shift needs some confidence about market access. When tariffs can appear, disappear, shift legal basis, or be folded into a trade review, businesses delay decisions.

That delay can become its own economic drag. A supplier waits to expand. A customer looks for a domestic alternative. A worker misses overtime. A local municipality collects less growth from industrial investment. Trade uncertainty often sounds like a boardroom issue, but it lands in ordinary places: mortgage decisions, shift schedules, small-town tax bases, and family budgets. That is why Greer’s message matters beyond Ottawa and Washington. It tells businesses that tariff risk may be part of the operating environment for years.

The July Review May Not Settle Everything

The CUSMA review is a major deadline, but it may not produce a clean ending. Under the agreement’s review process, the countries can extend the pact, move into annual reviews, or face a longer period of uncertainty before the agreement’s eventual expiry date. That structure gives Washington leverage if it wants to keep pressure on Canada and Mexico without immediately walking away.

For Canada, the danger is a half-settlement: enough agreement to keep trade moving, but not enough to restore confidence. If tariffs remain while the pact continues, Ottawa may claim it preserved the framework, while exporters still face higher costs in key sectors. Greer’s comments suggest that is exactly the kind of world Canada may need to prepare for. The central question is no longer whether tariffs are legal, fair, or economically wise. It is whether Canada can protect its economy if Washington has decided they are here to stay.

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