What happened
Canadian Prime Minister Mark Carney said Thursday that Canada is prepared to sign a trade agreement with the United States that benefits both countries, while emphasizing that any deal must be stable and credible. He made the remarks at a news conference in Thunder Bay, Ontario.
Carney rejected claims by US Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent that Canada walked away from talks for domestic political reasons, saying appointed US officials are not experts on Canadian politics and that Canada will always defend its own interests.
He also suggested Washington has softened its stance since talks collapsed last month, pointing out that the US no longer insists on demands related to Canada's language and culture. Shortly after, President Trump warned on Truth Social that Canada's economy would collapse if it treats him as an enemy, and repeated his threat of steep tariffs on Canadian-made vehicles and parts.
Why it matters
Carney's comments signal a potential shift toward de-escalation in a trade dispute that had appeared close to resolution before talks broke down. His call for clear guarantees on steel, aluminum and auto tariffs highlights the core issue of predictability for Canadian industry.
Trump's immediate rebuttal underscores the political sensitivity of the negotiations. With the threat of tariffs as high as 50% on Canadian autos and parts looming early next year, the stakes for Canada's economy remain significant.
Key facts
Carney said Canada is ready for a mutually beneficial trade agreement with the US, but only if it is stable and credible.
Carney wants guarantees that agreed tariffs on steel, aluminum and autos will not be changed arbitrarily.
Trump warned that Canada's economy will collapse if it treats him as an enemy, following his earlier threat of up to 50% tariffs on Canadian-made cars and parts.
What to watch next
Whether Washington formally drops the language and culture demands that Carney says have been removed from the table.
Whether Canadian and US officials resume talks after Carney's expression of readiness.
Whether Trump follows through on his tariff threat when the new year begins if no deal is reached.