Tariff deal unlikely before U.S. midterms, Canada’s ex-trade chief says

The ongoing negotiations surrounding the Canada-US-Mexico Agreement (CUSMA) remain stalled, with Canada's former chief trade negotiator Steve Verheul expressing skepticism about reaching a significant tariff deal before the U.S. midterm elections. According to reports from Global News, Verheul stated that Ottawa is unlikely to secure a meaningful agreement with Washington prior to November 2026. This assessment comes amid continued uncertainty over the future of trade relations between the two nations, particularly in light of shifting political priorities and economic pressures.

The first trilateral meeting to formally review CUSMA is scheduled for July 1, marking a critical step in the process. Officials from Canada, Mexico, and the United States will convene to assess the current state of the agreement and explore potential improvements. While this meeting represents a formalized effort to address concerns, it does not signal immediate progress toward resolving long-standing disputes. Verheul, who played a pivotal role in negotiating the original CUSMA under former President Donald Trump, emphasized that the current administration in Washington has yet to present a compelling offer to Canada.

Verheul’s comments were made during an appearance at a Bank of Montreal client event focused on the trade outlook. He noted that while the existing CUSMA provides some protection against U.S. tariffs—shielding many Canadian exports—he remains unconvinced that the agreement will endure without substantial revisions. His remarks suggest a broader concern among industry experts and policymakers about the sustainability of current trade arrangements, especially given the volatility of international trade policies and the influence of domestic political agendas.

The negotiations have been complicated by diverging interests between the two nations. Canada has consistently sought stronger protections for its agricultural sector, while the U.S. has pushed for stricter labor standards and environmental regulations. Additionally, the issue of digital trade and data privacy has emerged as a new point of contention, reflecting the evolving nature of global commerce in the digital age. These factors have contributed to the prolonged stalemate, with neither side willing to compromise significantly on key issues.

Verheul also raised doubts about the durability of trade deals negotiated with the U.S., suggesting that agreements reached under previous administrations may not withstand the test of time. This perspective underscores a growing awareness among Canadian officials and business leaders that the U.S. approach to trade policy is increasingly unpredictable, influenced by partisan politics and changing leadership. As such, any new agreement must account for these uncertainties to ensure long-term stability.

Looking ahead, the July 1 meeting is expected to serve as a platform for dialogue rather than a definitive resolution. While some analysts believe that the upcoming months could see renewed momentum, others argue that the lack of concrete proposals from Washington suggests that negotiations will extend beyond the current election cycle. With the U.S. midterm elections approaching, both sides may adopt a more strategic approach, prioritizing short-term gains over long-term commitments.

As the situation unfolds, the outcome of the trilateral meeting will be closely watched by stakeholders across all three countries. The success or failure of these discussions will have far-reaching implications for trade, investment, and economic growth. For now, however, the path forward remains uncertain, with the possibility of further delays or even a complete renegotiation looming on the horizon.