Canada optimistic that North American free trade agreement will survive

(Patria) - A Canadian official responsible for trade with the United States expressed optimism about the future of the North American free trade agreement, a pact that President Donald Trump has mocked and which is scheduled for review this year, AFP reports.

Dominic LeBlanc, Ottawa's minister for trade between Canada and the U.S., also expressed doubt about the idea that Trump could completely abandon the agreement, something the president reportedly considered as tensions with Canada grew.

"I am not pessimistic about renewing the trilateral framework," LeBlanc told the Canadian Club in Toronto, referring to the agreement between the United States, Mexico, and Canada (USMCA), which Trump signed and praised during his first term.

LeBlanc noted that when Trump announced new global tariffs last week to replace tariffs overturned by the U.S. Supreme Court, the White House quickly confirmed that goods compliant with the USMCA would remain exempt from the tariffs.

"They are doing this because it is in the U.S. economic interest to do so," LeBlanc said.

Under the originally agreed terms, the USMCA will be reviewed in July.
Trump has called the agreement "irrelevant" and said it offers "no real advantage" to the United States.

U.S. media have reported that he is considering scrapping the agreement while simultaneously seeking a separate arrangement with Mexico, a plan that reportedly gained momentum since Canadian Prime Minister Mark Carney sharply criticized American leadership at the World Economic Forum last month.

"A review is not a renegotiation," LeBlanc said, emphasizing that the agreement does not expire until 2036. "If there is no consensus in the review, the agreement continues."

LeBlanc also said that Trump's dismissive rhetoric about the USMCA does not match the stance of his trade team.

"There is a public pursuit of an argument, a political argument, in the United States, and there are private conversations between governments that are not discouraging."

LeBlanc said he expects to meet with U.S. Trade Representative Jamieson Greer in Washington next week and believes the United States is ready to be specific about desired adjustments to the USMCA.

"We are ready for those talks," he told the Canadian Club.

Free trade with the United States is crucial for the Canadian economy. Trump's sectoral tariffs targeting automobiles, steel, aluminum, and lumber have caused significant economic problems in Canada.
But Trump's broad adherence to the USMCA has left about 85 percent of two-way trade tariff-free, sparing Canada from devastating economic turmoil.

Carney flew to India on Thursday to seek closer trade ties, as part of his strategy to support the Canadian economy in the event of a collapse of free trade with the U.S.