Canada and the United States are locked in last-minute negotiations as Ottawa attempts to prevent another wave of American duties from taking effect on Wednesday.
Canadian officials have spent the past week in Washington seeking an agreement that could avert proposed 50% levies covering approximately $20 billion (C$28 billion) worth of Canadian goods.
Prime Minister Mark Carney declined to reveal details of the discussions on Monday, describing the negotiations as highly sensitive.
He said it would be inappropriate to conduct the bargaining publicly while the two countries remain engaged in difficult discussions.
Carney also held a telephone conversation with US President Donald Trump on Monday regarding the negotiations, according to the Canadian leader’s office.
The Canadian prime minister insisted that Ottawa was entering the talks from a position of strength, but the potential consequences remain significant.
The proposed measures would affect about 5% of Canada’s imports from its southern neighbour.
Canadian representatives have held several meetings with US Trade Representative Jamieson Greer, but no final settlement has yet emerged.
”We still have work ahead of us,” Canada’s Trade Minister Dominic LeBlanc said after leaving Greer’s office.
President Trump has previously described Canada’s approach to trade as “nasty” and has threatened a tougher American response if Ottawa and Washington fail to resolve their differences.
Any compromise reached by Carney could also prove politically difficult at home.
The prime minister would have to convince Canadians that the agreement protects national interests while securing support from provincial governments.
Washington is seeking several changes from Ottawa.
Among them are the removal of Canada’s remaining countermeasures against American vehicles and alterations to restrictions governing dairy imports.
The United States is also pressing for provincial governments to end restrictions on American alcoholic beverages.
Those measures were introduced by several provinces following earlier US tariff decisions.
Ontario Premier Doug Ford has indicated that alcohol restrictions could only be lifted if Canada receives meaningful protection for important domestic industries.
Ford said Canadian steel, vehicle manufacturing, forestry, farming and other industrial sectors would need to benefit from any settlement before American alcoholic products return to provincial shelves.
Dairy policy presents another potential obstacle.
Quebec’s premier, Christine Fréchette, has maintained that the province’s supply-management system cannot be compromised.
The arrangement controls domestic production through quotas, establishes pricing mechanisms and limits overseas access to Canada’s dairy, poultry and egg markets.
President Trump has criticised the framework, arguing that it unfairly limits opportunities for American producers.
The latest US tariff package was announced by the White House on 20 July.
Washington said the measures would begin 30 days later, putting the deadline on Wednesday, 19 August.
Public sentiment in Canada could make negotiations even more challenging.
An Abacus Data survey found that 74% of respondents believe the dispute has affected their households, while 36% support imposing additional Canadian duties on US products despite the possibility of further economic damage.
Only 18% backed making concessions such as lifting provincial restrictions on American alcohol in exchange for lower American tariffs.
Canadian media reports have also indicated that Ottawa’s lead negotiator, Janice Charette, cautioned US officials that implementing the new measures could jeopardise future discussions between the two countries.
Carney has repeatedly stated that he will not accept an agreement unless it delivers a satisfactory outcome for Canada.
However, he has yet to specify the precise conditions he considers essential.
With negotiations entering their final 48 hours, the prime minister said further discussions would determine what happens next.
He also indicated that his administration had contingency plans should the negotiations collapse.
Conservative trade critic Shuvaloy Majumdar called for an end to the uncertainty affecting Canadians, saying the country deserved relief from mounting economic concerns.
He argued that Canadians had become frustrated with being targeted during the dispute, while expressing hope that Carney could secure a meaningful victory at the negotiating table.
By: Magdalene Agyeiwaa Sarpong