Canada is continuing to negotiate a trade deal with the United States that will allow it to both avoid U.S. President Donald Trump's crippling tariff threat — set to come into effect on Wednesday — and get some additional relief on existing tariffs in key sectors.
But after a flurry of meetings between top Canadian and American negotiators over the last three weeks, the two countries remain at an impasse heading into the home stretch.
Sources have told CBC News that Canadian negotiators fear there may be no way to avert Trump's 50 per cent tariffs on hundreds of Canadian goods, as Washington digs in on its demands while Ottawa tries to persuade provinces to lift restrictions on American alcohol.
The U.S. claims it's imposing the tariffs because of Canadian discrimination toward its automobile, dairy and alcohol sectors.
With two days left to negotiate, here's what sources have told CBC News about where Canada-U.S. trade talks stand on Monday morning, broken down by each key sector.
Negotiators fear U.S. tariffs will be imposed as sides dig in
According to sources, the U.S. is proposing to reduce its existing auto tariffs from the current 25 per cent down to 12.5 per cent, an offer the Canadian side believes is not good enough.
The U.S. has cited issues with Canada's auto trade as one reason why it intends to impose its 50 per cent tariffs. The White House argues Canada imposes tariffs and quotas on vehicles imported to Canada from the U.S. — but not other countries.
Negotiators fear U.S. tariffs will be imposed, as provinces and Washington dig in on demands
Lana Payne, national president of Unifor and a member of Prime Minister Mark Carney's advisory committee on Canada-U.S. economic relations, said on Friday that Trump is missing the fact that his auto tariffs hurt U.S. companies.
"We can't afford to give any more concessions here, and we need a good deal. And that means we've got to grind it out until the very end," Payne said.
Payne has previously warned that agreeing to the levies in writing now could give Washington a path to seeking permanent auto tariffs as part of a renegotiated Canada-United States-Mexico Agreement (CUSMA).
Sources say, however, that Canada will need to concede some ground in any sort of deal.
Trump has long lambasted Canada's supply management system, which allows a certain amount of U.S. dairy to enter Canada tariff-free before steep duties are applied.
In announcing its 50 per cent tariff threat, the White House said Canada established tariff-rate quotas on cheese from the U.S. that are "much more restrictive" than the quotas applied on similar imports of cheese from the European Union.
