What’s next for U.S.-Canadian trade after the explosion deadline?

Friday came and went to the deadline for a new U.S.-Canada trade deal. So, what happens next to these two deep neighbors?

Canada and the United States have been locked in the tariff war for six months, and despite talks about “hard” negotiations in recent weeks, the trade agreement remains elusive.

Both President Donald Trump and Prime Minister Mark Carney poured cold water on the idea that they would make a quick and priceless deal. Trump publicly criticized Canada for recognizing the last-minute deal reached by the Palestinian state earlier this week.

Pessimism marks a shift in tone at the G7 meeting in June, when the two leaders set themselves as summer deadlines.

Fen Hampson, professor of international affairs at Carlton University in Ottawa, said Canadian negotiators concluded that it is not the end of the world without the quality of a fast and “overcome the quality of a speed and hasty agreement.”

Carney was nervous about the details of the negotiations, and he talked a lot about himself, repeatedly saying that “any deal” would not be done.

Despite this, both parties still have pressure to put the company on probation.

Conservative leader Pierre Poilievre said Friday he shared “Canadian’s disappointment” with no agreement reached on the deadline. He urged Carney’s liberals to do more to “retrieve control of our economic future.”

Canada now faces a tariff rate of 35%, although under the current free trade agreement, goods are in line with the sale of goods. Global tariffs on steel, aluminum, automobiles and auto parts in the United States are being hurt because the United States is the top market for these sectors.

The Trump administration proved these tariffs by claiming a lack of cooperation to stop the flow of illegal drugs such as fentanyl. Canada denies that about 1% of U.S. fentanyl imports originate from Canada. In recent months, it has also brought new border protections and the “fentanyl tsar” to address Trump’s concerns.

Tariffs and expectations that threaten copper Global tariff exemption for goods under $800 Maybe pinch it too.

There is a Canada Response to $6 billion ($43.3 billion; £32.3 billion) billing for various U.S. goods – The only country in China Retaliation against Trump directly.

“It’s no surprise that businesses are eager to determine what certainty to be determined after months and months of turbulent announcements,” said Catherine Fortin-Lefaivre, vice president of international policy and global partnerships at the Canadian Chamber of Commerce.

“But at the same time, they are not eager to get a bad deal at the expense of.”

Some factors provide some breathing space for Canada.

On the surface, the country appears to face severe U.S. tariff rates, but trade is now more freer than taxes at first glance.

In March, Trump announced a tariff application for goods that comply with the Canadian-Mexican agreement, known in Canada as Kusma and the United States as USMCA.

The deal – negotiated during the first term of Trump’s term – took effect five years ago.

Under the agreement, almost 90% of Canada’s exports to the United States will eventually be exempt from border obligations if the company submits the necessary paperwork.

“This gives us a buffer, and there is no doubt that other countries don’t have it yet,” Professor Hampson said.

This means that Canada generally pays a much lower tariff rate than many deals already signed with the United States, such as the EU, South Korea and Japan, accounting for 15%, or 19% in Indonesia and the Philippines.

Ottawa has also brought some relief plans for the affected industries, and due to counter-tariffs, import tariffs are $1.5 billion more than the same period last year.

Despite growing confidence in the U.S. and prices still exist there, it helps Canada’s negotiating stance if they can wait for Americans to start feeling the pain of tariffs.

Professor Hampson said: “It’s Americans who want to quarrel.”

Ms. Fortin-Lefaivre predicts that U.S. businesses, especially smaller companies that do not have the same resources to bear these resources, will put pressure on political leaders.

“So the pressure can play to our strengths,” she said.

Canadians seem to be willing to give the new prime minister some room. Polls show that they are usually happy with his handling of trade.

Carney “knows that what’s most economically good now is actually what’s best for him politically,” Martha Hall Findlay, a former liberal MP, told the BBC.

Trump said he is on tariffs on promoting domestic manufacturing, opening up overseas markets and raising funds for the government.

He also used them to push countries like Canada toward a range of non-trade issues, including military spending.

Over the past few weeks, Ottawa has greatly increased its defense spending, increased security of shared borders, and killed digital taxes that U.S. tech companies have opposed.

Ms. Fortin-Lefaivre said the moves show that Canada is “doing what Americans want us to do.”

She hopes Canadian negotiators push for tariffs as low as possible and work to ensure that two deeply integrated supply chains can continue to work together.

Canada forces 50% of steel and aluminum tariffs to ease, which Crowding American automakers.

Treasury Secretary Scott Bessent sent a signal in an interview with CNBC on Thursday that it was the choice on the table.

Meanwhile, Trump has added a lot of long-term trade stimulus in addition to fentanyl, including Canada’s protection in its dairy industry.

Ottawa has previously warned that if the conversation collapses, there are more countermeasures, although political desires may be waning.

British Columbia Prime Minister David Eby recently told Bloomberg that the retaliatory tariffs “looks not yet have the same impact we hoped for.”

Regarding revenge, Professor Hampson said: “Americans have upgraded their dominance here. So you want to stay smart about it.”

A spokesman for Carney declined to say whether there were any more countermeasures. Meanwhile, Canadian negotiators spent most of this week in Washington and continued to push for negotiations with the minister in charge of Canada-U.S. Friday’s trade says An acceptable agreement is “not seen yet.”

“We all yearn for certainty in the agreement,” Ms. Fortin-Lefaivre said.

But research from her business team shows that the company is developing contingency plans. Almost 40% of commodity exporters have diversified suppliers outside the United States, with 28% of buyers having diversified buyers.

They are also looking forward to a more challenging conversation with Cusma, who has proven to be a key defender as reviews are due to take place next year.

It is part of a broader push nationwide, allowing trade to stand out from the United States, weakening barriers to trade between provinces and rising toward larger projects faster.

Economic ties between the two countries will remain strong – Canada will remain the United States’ largest trading partner and economic and security allies.

But ironically, Trump’s threat could be “forced Canada to understand that we have to be organized,” Ms. Hall Findlay said.

“It’s going to take some very tough decisions. I do think our current government has gotten that.”