Canada and the US to launch formal talks to review their free trade
agreement in mid-January
[December 20, 2025] By
ROB GILLIES
TORONTO (AP) — Canada and the U.S. will launch formal discussions to
review their free trade agreement in mid-January, the office of Canadian
Prime Minister Mark Carney said.
The prime minister confirmed to provincial leaders that Dominic LeBlanc,
the country’s point person for U.S-Canada trade relations, “will meet
with U.S. counterparts in mid-January to launch formal discussions,"
Carney’s office said in a statement late Thursday.
The United States-Mexico-Canada trade pact, or USMCA, is up for review
in 2026. U.S. President Donald Trump negotiated the deal in his first
term and included a clause to possibly renegotiate the deal in 2026.
Carney met with the leaders of Canada’s provinces on Thursday to give
them an update on trade talks with the U.S.
Canada is one of the most trade-dependent countries in the world, and
more than 75% of Canada’s exports go to the country's southern neighbor.
But most exports to the U.S. are currently exempted by USMCA.
Trump cut off trade talks to reduce tariffs on certain sectors with
Carney in October after the Ontario provincial government ran an
anti-tariff advertisement in the U.S. That followed a spring of
acrimony, since abated, over Trump’s insistence that Canada should
become the 51st U.S. state.
Carney said earlier Thursday that Canada and the U.S. were close to an
agreement at the time on sectoral tariff relief in multiple areas,
including steel and aluminum. Tariffs are taking a toll on certain
sectors of Canada's economy, particularly aluminum, steel, auto and
lumber.
Carney also said trade irritants flagged this week by U.S. Trade
Representative Jamieson Greer are elements of a “much bigger discussion”
about continental trade. Greer said a coming review of the Canada-U.S.-Mexico
trade deal will hinge on resolving U.S. concerns about Canadian policies
on dairy products, alcohol and digital services.
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Canada's Prime Minister Mark Carney pumps his fist as he arrives to
deliver remarks at the Liberal caucus holiday party in Ottawa, on
Thursday, Dec. 11, 2025. (Justin Tang/The Canadian Press via AP,
File)
 Carney and the provincial premiers
agreed to meet in person in Ottawa early in the new year.
Canada is the top export destination for 36 U.S. states. Nearly $3.6
billion Canadian (US$2.7 billion) worth of goods and services cross
the border each day.
About 60% of U.S. crude oil imports are from Canada, as are 85% of
U.S. electricity imports.
Canada is also the largest foreign supplier of steel, aluminum and
uranium to the U.S. and has 34 critical minerals and metals that the
Pentagon is eager for and investing in for national security.
Carney said U.S. access to Canada’s critical minerals is not a
certainty.
“It’s a potential opportunity for the United States, but it’s not an
assured opportunity for the United States. It’s part of a bigger
discussion in terms of our trading relationship, because we have
other partners around the world, in Europe for example, who are very
interested in participating,” Carney said earlier Thursday.
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