February 25, 2019 12:49 pm
Updated: February 25, 2019 2:49 pm

Trump boasts that threat of tariffs forced Canada to agree to new NAFTA deal

WATCH: Trump says he got USMCA approved by putting tariffs on Canada

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U.S. President Donald Trump boasted Monday that his threat of auto-tariffs helped force Canada’s hand when agreeing to the Canada-U.S.-Mexico Agreement.

CUSMA, called USMCA in the U.S., is the replacement to the former North American Free Trade Agreement that Trump wanted to renegotiate. It was signed on Nov. 30, after months of tense talks between the three countries.

“It was very tough to negotiate, you know, we think of ‘O Canada,’” Trump joked. “’O Canada’ is tough, they’re tough.”

Speaking to reporters on Monday morning, Trump said he was able to get Canadian officials to sign the deal by threatening to impose tariffs on Canadian-made automobiles.

WATCH: Trudeau, Trump, Nieto sign ‘new NAFTA’ agreement (Nov. 30, 2018)


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“It’s a deal that nobody thought we’d be able to get it approved. I was able to get it approved to be honest with you by using tariffs. I was putting very substantial tariffs – or was getting ready to – on Canada,” he said.

“And I said, ‘You’re either going to do this, or we’re going to put 20-25 per cent tariffs on your cars that you ship in here by the million.’”

Asked about the boast from Trump, officials from Global Affairs said they held out for a “good deal for Canada.”

“Since day one of the NAFTA negotiations, we said that we wanted a good deal for Canada,” spokesperson John Babcok told Global News. “We held out for that good deal and that is what we achieved.”

Trump did in fact publicly threaten to put tariffs on cars in September 2018. At the time, Prime Minister Justin Trudeau said the economic impact would have been devastating for both Canada and the U.S.

The deal was signed by the leaders of the three countries but has not yet been ratified.

Transport Minister Marc Garneau said Parliament will struggle to pass the deal if the current U.S. tariffs on steel and aluminum persist.

READ MORE: Tariffs impeding passage of USMCA deal through Parliament, Garneau warns U.S. governors

“This will present us with real challenges as we begin the process of ratification in Canada, and I don’t know if we’re going to get there,” Garneau told a free-trade panel during the winter meeting of the National Governors Association in Washington on Sunday.

The steel and aluminum tariffs, a separate issue from auto-tariffs, have been in place since early 2018. Canada – along with Mexico and European countries – have imposed counter tariffs they say are for equivalent dollar values.

READ MORE: Canada’s retaliatory tariffs sparking complaints from Americans, says ambassador

The deal also needs to be ratified in U.S. Congress; but it has received mixed reviews on Capitol Hill, particularly among Democrats who want to see sharper enforcement for the deal’s labour and environmental provisions. A number of members of Congress also oppose extending protection for drug patents by two years.

But Trump is confident it will pass.

“I know they hate me but they’d have to hate me even more not to sign the deal,” Trump said Monday, apparently referring to the Democrat-led House.

WATCH: NAFTA didn’t do what it promised, Unifor’s Jerry Dias says 

*With files from the Canadian Press

© 2019 Global News, a division of Corus Entertainment Inc.

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