The United States and Canada are heading into the final hours of a high-stakes trade negotiation that could determine whether a new 50% U.S. tariff on roughly $20 billion of Canadian goods takes effect just after midnight.
Canadian Trade Minister Dominic LeBlanc said the two sides were “very close” after lengthy negotiations in Washington, but no final agreement had been announced as of Friday morning.
Negotiators are meeting again Friday as they try to resolve the remaining issues before the 12:01 a.m. ET Saturday deadline.
The agreement under discussion could materially reduce tariffs in two of the most important cross-border industries.
U.S. tariffs on Canadian-built vehicles could fall to 15% from 25%, while tariffs on Canadian steel and aluminum could be cut to 25% from 50%.
Those percentages matter because the U.S. and Canadian manufacturing systems are deeply intertwined. A vehicle assembled in Canada can contain engines, electronics, steel and other components produced on both sides of the border. Some parts cross the border multiple times before a finished vehicle reaches a dealership.
A 25% or 50% tariff therefore does not simply hit a foreign exporter. It can raise costs for American automakers, manufacturers, builders and consumers that depend on Canadian materials and components.
There are still unresolved details, including how Canadian content will be calculated and how exemptions for auto parts would work.
The negotiations have moved rapidly. Earlier this week, President Donald Trump temporarily delayed the new tariffs for three days while the two governments continued negotiating. Canada has said important work remains even as both sides report significant progress.
For businesses operating across the northern border, Friday is therefore more than another trade-policy deadline. A deal could lower costs almost immediately in autos and metals. Failure could force companies to reconsider sourcing, pricing and production decisions beginning Saturday morning.
JBizNews Desk | Washington
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