As tariff deadline nears, what does Trump want from Canada? And will he get it?

WASHINGTON, D.C. — Canada is less than a week away from 50 per cent tariffs taking effect on nearly US$20 billion worth of exports to the United States, after the White House invoked the never-before-used Section 338 of the Tariff Act of 1930 to impose duties on more than 400 Canadian products beginning Aug. 19.

Trade watchers said the move was designed to create leverage and force Ottawa back to the negotiating table. Canada-U.S. Trade Minister Dominic LeBlanc and Chief Negotiator Janice Charette have heeded the call, repeatedly showing up for meetings in Washington in recent weeks to try to head off the 338 tariffs and reach a deal on the Section 232 sectoral tariffs on steel, aluminum, and lumber.

The pair returned to Washington this week, meeting with U.S. Trade Representative Jamieson Greer on Tuesday afternoon, but both sides have been tight-lipped about progress.

“Discussions remain ongoing, and we continue to engage at the negotiation table to firmly advance and defend Canadian interests,” LeBlanc posted on social media after his Tuesday meeting. His posts in recent weeks have been similarly opaque, but a source close to the negotiations told National Post that the Canadian side remains “cautiously optimistic” of a breakthrough.

Others expect the tariffs to take effect, even if only briefly or in altered form.

“I don’t see anything that indicates that the U.S. side is interested in doing a balanced, comprehensive, mutually beneficial deal,” said Lawrence Herman, senior fellow at the C.D. Howe Institute and a specialist in international trade and investment law.

“I think we’re going to have those 338 tariffs next week, and I don’t know what can be done to prevent those coming on.”

Richard Stern, of the Plymouth Institute for Free Enterprise at Washington-based Advancing American Freedom, also thinks there will be some tariffs, but not in the threatened form. He thinks the Trump team will find a way to claim victory while making some adjustments.

“I expect some version of them to go into effect,” Stern said, adding that he would “be surprised if they go into effect in full.”

Others believe there could be a delay or quick reversal if the duties are implemented.

Inu Manak, senior fellow at the Peterson Institute for International Economics, said she thinks it’s more likely that Trump will avoid full implementation, announce a deal of some sort, or reverse course quickly after the tariffs spark a market reaction.

“Looking at patterns of how he’s done things in the past, I would say it’s likely that he probably won’t impose them, that he’ll want to have a deal to announce,” she said, cautioning that any deal would be narrow and unrelated to the CUSMA renewal.

But even if Trump imposes the full tariffs, Manak believes they’ll be short-lived owing to market pressures.

“When President Trump imposes very large tariffs, you get an immediate market reaction, and typically a few days later he reverses course.”

The unresolved question is what Washington would accept as a win.

“I wrestle with this question every day,” said Jamie Tronnes, executive director of the Center for North American Prosperity and Security. “It’s really hard to know if you can meet the goalpost if you don’t know what the goalposts are.”