‘The year that the shoe dropped’: Canada-U.S. relationship in 2025

The people anxiously sipping hot chocolate in the Canadian Embassy in Washington on a cold night in January almost a year ago couldn’t have predicted the roller-coaster of trade provocations and bilateral blow-ups the next 12 months would bring. In hindsight, that unusually chilly Washington evening foreshadowed how the Canada-United States relationship would soon freeze over. U.S. President Donald Trump’s tariff threats and his talk of annexing Canada had already rattled Canadian politics over the preceding weeks. A rushed trip to Mar-a-Lago in early November 2024 failed to mend former prime minister Justin Trudeau’s already rocky relationship with the incoming U.S. president. On Jan. 20, the day of his second inauguration, Trump returned to the Oval Office to announce his “America First” trade policy. Just weeks later, he announced sweeping tariffs on Canadian imports . By early February, it was obvious to everyone the relationship Canadians thought they had with their closest neighbour was over. Former foreign affairs minister Mélanie Joly called on “every single political leader across the board, across the country, to stand united because, now more than ever, we need to make sure that we put country first.” It was all happening amid a swift domestic political upheaval that saw Trudeau, weakened by poor polling and internal Liberal party dissent, announce on Jan. 6 he would resign as prime minister as soon as a new Liberal leader was chosen. Mark Carney became party leader in March, and almost immediately launched an election, forming a minority government following a campaign that centred on Trump. Trump’s tariffs - which don’t apply to goods compliant with the Canada-U.S.-Mexico Agreement on trade, known as CUSMA - hit Canada in March. They were boosted to 35 per cent in August as Trump complained about Canada’s retaliatory tariffs and supply management in the dairy sector, and claimed Ottawa hadn’t done enough to stop the very modest cross-border flow of fentanyl. The president’s separate Section 232 tariffs on specific industries, such as steel, aluminum, automobiles, copper and lumber, have also hit Canada hard. Get breaking National news Terms and Conditions and Privacy Policy . Trump took his trade war global in April with his so-called “reciprocal” tariffs on nearly every nation. World leaders raced to respond. Some signed frameworks of trade agreements that promised massive investments in the United States in exchange for slightly lower tariff rates. The speed and scale of Trump’s trade war with the world caught everyone off guard, said Fen Osler Hampson, a professor of international affairs at Carleton University in Ottawa and co-chair of the Expert Group on Canada-U.S. Relations. While the president toned down his annexation talk after Carney’s election, every deadline for a trade deal since then has come and gone, with no clear progress. Talks remain stalled. “That’s ... I would hasten to add, no fault of (Carney’s),” Hampson said. Carney suspended Canada’s digital sales tax, tightened border security, dropped most retaliatory tariffs and boosted defence spending in an unsuccessful effort to get Trump to drop...

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