W hat follows are the remarks Prime Minister Mark Carney delivered in Ottawa after the suspension of Canada–United States trade talks on August 22, 2026.
I’d like take this opportunity to update Canadians on developments in our trade negotiations with the United States. I’m going to go through why we’re walking away from a bad deal and what comes next.
For much of our history, Canadians have been able to count on favourable trade winds: a stable relationship with the United States, increasingly open access to the American market, and rules that both countries understood and respected. Those winds haven’t simply changed direction. The weather itself has changed. We can’t control the storm that blows in from Washington. We can, however, chart a new course by building Canada strong at home and diversifying our trading relationships abroad. We are masters in our own house and the partner of choice abroad.
For over a year, Canada has worked intensively and in good faith with the United States to negotiate a new comprehensive trade deal. We’ve been pragmatic, patient, and persistent. We pursued every opportunity to reach an agreement that protects Canadian workers and their families, that strengthens our economy, and that respects Canadian sovereignty.
We’ve been under no illusions. We recognized, from the start, that America has changed. Early last year, I observed that the decades-long process of steadily increasing integration between our economies was over. Our government understood before many that America would transform all of its commercial relationships, that it would put a series of tariffs on its closest allies, and use economic integration as a weapon. We recognize that sometimes its signature was written in pencil.
We worked in that context to try to strike a fair deal on which Canadian businesses and workers could rely. Our goal has always been to get the best deal for Canadians, never a deal at any price or on any time frame. Last month, when the United States announced another round of unjustified tariffs, I gave our negotiating team a new mandate: to seek a fair deal negotiated in good faith. I believe that people on the ground, on both sides of our border, want this relationship to work. The bonds between Canadians and Americans are long, and they remain strong. A mutually beneficial trade agreement is possible—one that respects our sovereignty, one that builds on our complementary strengths, one that lowers costs for families on both sides of the border, one that creates good jobs for our workers.
Canada has always worked towards these goals, even while America’s attention and dedication to them have wavered. We’ve consistently proposed long-term partnerships, while America has often pursued short-term transactions. The gap between partnership and competitor, unfortunately, has remained too wide in recent days.
So last evening, I instructed our negotiators to return to Ottawa. We cannot accept what they’ve offered, and we will not give what they’ve asked. Over the past year, the US has imposed a series of tariffs that violate its commitment under our agreement with them in Mexico, so-called CUSMA. The United States has continually changed the rationale for these actions, from fentanyl to taxes on US tech giants, to certification of US aircraft, to the sharing of tolls of a bridge that Canada built and paid for, to our dairy policy, to provincial decisions not to sell American alcohol during the trade war, to a television advertisement that quoted Ronald Reagan, to smoke from wildfires while they threatened our communities.
Another prominent justification for US tariffs has been their claim that since the United States runs a “trade deficit” with Canada, we were “ripping them off.” But the US narrow merchandise trade deficit only exists because the US buys so much of its energy from Canada. Canada fuels American growth, supplying 99 percent of their natural gas imports, 85 percent of their electricity imports, 60 percent of their crude oil imports. I don’t think they want us to stop sending any of that energy.
And if you look more broadly at the comprehensive US–Canada trade balance, which includes the many services from financed entertainment that we buy from the United States, that shows a persistent American trade surplus. Most fundamentally, trade is about building mutual strength, creating a relationship that benefits both countries. For example, Canada is the largest customer for US cars. In fact, we buy more American-built cars and trucks than the United Kingdom, Japan, and China combined. It’s the same for American steel products. Canada is also the largest customer for twenty-six US states and a top-three customer for forty-five US states.
Last year, Americans sold almost $600 billion in goods and services to Canadians. That’s more than $1.6 billion every single day. On the other hand, Canadian exports to the United States lower costs for American families. In contrast, tariffs are taxes, taxes which are ultimately paid by US consumers.
While the United States has imposed a seemingly endless stream of tariffs and threatened more, Canada has, by contrast, taken several steps in good faith to try to find compromise and secure a comprehensive deal in the best interests of both Canadians and Americans. Our negotiators sought not only to reduce tariffs but also to restore a degree of certainty and stability through a new comprehensive agreement that Canadian businesses and workers could rely on.
Last month, the US announced that effective August 19, it would impose 50 percent tariffs on a series of industries, ranging from hockey equipment to clothing, cement, and beer. The only advantage of this latest threat was that it was a catalyst for more intensive negotiations. Our objectives in these latest talks have been to preserve tariff-free access to the US for the vast majority of Canadian businesses. Secondly, to provide greater stability to our trade relationship. Thirdly, to significantly reduce US tariffs on our key strategic industries so that Canadian businesses in these sectors would have the best access of any in the world. Fourth, protect our small and medium-sized businesses, including by removing the imminent threat of those new tariffs. And fifth, fundamentally, maintain Canada’s flexibility, independence, and sovereignty so we can keep building the country Canadians want.
Canada has made offers to secure a fair, comprehensive deal that would be in the best interests of Canadians. We were willing to drop our remaining retaliatory tariffs on strategic sectors, particularly steel, aluminum, and autos—if the United States substantially lowered theirs to levels that made it economic for Canadian companies to export to the United States. In exchange for a fair deal, we would encourage our provinces to return US alcohol to the shelves, and we would take administrative measures to protect supply management without changing the system itself, the US quotas or the tariffs that would apply.
There were some things we wouldn’t do. We were not prepared to compromise Canada’s sovereignty or to undermine our key industries. We were not prepared to compromise on our sovereignty, the protection of the French language, or our culture. To be clear with our American colleagues, for my government and for Canada, these issues were never on the table, even though the United States pushed for them until the very last minute.