Negotiations between the United States and Canada on a trade deal collapsed at the last minute due to pressure from US Commerce Secretary Howard Lutnick, Bloomberg reports, citing sources familiar with the matter. The official reportedly considered the draft agreement too generous toward Ottawa.
The Canadian side accused him of changing the terms of the deal as negotiations were already underway. In the final days of the talks, Lutnick also began holding parallel discussions directly with Prime Minister Mark Carney, even though US Trade Representative Jamieson Greer was the lead negotiator for the US delegation.
According to Bloomberg, Lutnick insisted on removing a concession to Canada that would have reduced tariffs from 50% to 25% on a certain quota of Canadian metal imports. Sources told the agency that representatives of US steel and aluminium companies had pushed for the change. Bloomberg reported that those companies were pleased with the collapse of the talks.
It remains unclear whether the secretary intended to derail the agreement or simply sought to revise its terms. One source told the agency that Lutnick appeared to be betting that Canada would accept the new conditions. However, the Canadian prime minister said the new US demands were excessive.
Following the collapse of the negotiations, US President Donald Trump intends to impose new 50% tariffs on some Canadian goods, while Canadian Prime Minister Mark Carney has vowed to retaliate.
