How do we get back to the table?

Now that trade talks between Canada and the U.S. have fallen apart, the war of words is escalating, and increasingly pointed insults are being thrown across the border. Reacting out of anger might feel good in the moment, but we cannot lose sight of the fact that the U.S. is and will remain our most important relationship for many years to come.

We absolutely need to diversify our export markets. It never makes sense to only have one customer. At the same time, we also need to protect the access we have to the world’s largest economy. We need time to build the structures and habits needed to sell things elsewhere.  We also need to remember that no President or Administration lasts forever. As we navigate the current disruptions, we also need to keep an eye on our long-term interests so that we are well positioned in the future to make the most of our geographic advantage.

So how do we get back to the negotiating table?

First, we need to breathe and think strategically. We are facing down a bully that is much larger than us. We are not going to fight our way out of this situation; we need to think our way out. How can we use strategic reciprocal tariffs for maximum effect? Imposing these just weeks before the U.S. midterm elections in November could help to make trade policy an issue in the campaign. What other levers can we pull – and when – to demonstrate the mutual benefit of our trading relationship? Remember that a breakdown in negotiations is not necessarily a bad thing. Sometimes, a pause is exactly what is needed to refocus on key priorities and get creative about the approach and content of the next round.

Second, we need to be working our networks. While President Trump loves to own the trade and tariff agenda, the U.S. Supreme Court has confirmed what is in the U.S. Constitution: that authority for trade rests with Congress. Now is the time to connect with U.S. counterparts to encourage them to speak up and put pressure on the Administration to negotiate a fair deal with Canada. We know that tariffs and trade uncertainty are not helpful in an affordability crisis, but Canada will be much more successful in having those messages heard if they are carried by Americans.

Third, we need to push forward with efforts to diversify our export markets, break down barriers to internal trade within Canada and build infrastructure. Increasing our options increases our strength at the negotiating table.

Finally, while it may not feel like it, we still have a valid trade agreement with the U.S.: the CUSMA. The pain of tariffs is very real, and it’s about to get tougher. But we cannot rush to conclude a new agreement that is worse than what we already have. Now is the moment to play to our strengths. Canada has what the world needs, and we should take confidence from that.