‘We know how to work together’: U.S. Ambassador Hoekstra on partnership with Canada amid CUSMA talks – CTV News

U.S. Ambassador Hoekstra stated that the United States and Canada “know how to work together,” signaling a collaborative approach to the bilateral partnership as the Canada-United States-Mexico Agreement (CUSMA) faces upcoming review talks. This assertion, reported by CTV News, arrives as Canadian officials and economic advisors prepare for potential trade volatility and conflicting signals from the U.S. administration regarding tariffs and the future of the USMCA.

What did Ambassador Hoekstra say about U.S.-Canada relations?

U.S. Ambassador Hoekstra emphasized the historical and functional capability of the two nations to resolve disputes and maintain a productive partnership. According to CTV News, the Ambassador’s comment that “we know how to work together” is intended to provide a stabilizing narrative amid concerns over the 2026 review of the CUSMA trade deal. The statement suggests that despite political rhetoric, the diplomatic machinery between Washington and Ottawa remains operational.

This diplomatic assurance comes at a time when the trade relationship is under intense scrutiny. The CUSMA agreement, which replaced NAFTA, includes a “sunset clause” requiring a joint review every six years. As that deadline approaches, the Ambassador’s focus on cooperation serves as a counterweight to fears that the U.S. might seek a radical overhaul of the agreement or impose unilateral tariffs.

Why are there conflicting views on the future of the USMCA?

While diplomatic channels express optimism, political signals from the U.S. executive branch have been inconsistent. The Globe and Mail reports that recent comments from Donald Trump regarding the USMCA provide evidence of conflicting views on trade. On one hand, the administration has touted the deal as a success of “America First” policies; on the other, there have been threats to use tariffs as leverage to force renegotiations or address specific trade imbalances.

The tension lies in the difference between the structural stability of the trade agreement and the tactical use of trade threats. According to analysis from CBC, it is unlikely that the U.S. would completely “rip up” CUSMA. The reasoning is rooted in the integrated nature of the North American supply chain, particularly in the automotive and energy sectors, where a total collapse of the agreement would cause significant economic disruption within the U.S. itself.

Key points regarding the U.S. trade stance include:

• Rhetorical Leverage: The use of tariff threats is often viewed as a negotiating tactic rather than a definitive policy goal.
• Supply Chain Integration: The deep interdependence of the three North American economies makes a total exit from CUSMA high-risk.
• Political Branding: The administration seeks to claim victory by “improving” the deal, even if the core tenets remain unchanged.

How is Canada preparing for CUSMA negotiations?

Canada is adopting a multi-pronged strategy to protect its economic interests. Global News reports that Minister LeBlanc has explicitly stated that Canada is not “an idle spectator” in U.S. trade negotiations. This indicates a proactive approach involving both diplomatic lobbying and the preparation of contingency plans should the U.S. demand significant concessions.

The federal government’s strategy focuses on demonstrating the value of Canadian exports to the U.S. economy. By framing the relationship as mutually beneficial rather than a zero-sum game, Ottawa aims to mitigate the risk of tariffs. This involves highlighting Canada’s role as a secure provider of critical minerals, energy, and agricultural products.

What role do Canadian premiers play in U.S. trade relations?

Beyond federal diplomacy, there is a growing emphasis on “sub-national” relations. Mark Carney has urged Canadian premiers to maintain and expand their networking with American counterparts, according to the Toronto Star. This strategy recognizes that many trade ties are regional rather than national. For example, the trade relationship between Alberta and Texas in the energy sector or Ontario and Michigan in the automotive sector often operates independently of federal friction.

By fostering direct relationships between provincial leaders and U.S. governors, Canada creates a “web of interests” that can pressure the U.S. federal government to avoid disruptive trade policies. If U.S. governors fear that tariffs will hurt their own state’s economy, they are more likely to lobby the White House for stability.

Carney’s advice underscores a shift toward a decentralized diplomatic effort, ensuring that if federal talks stall, regional economic ties remain intact. This approach targets the specific economic dependencies that make the CUSMA framework essential for both nations.

Why is CUSMA unlikely to be completely scrapped?

Despite the volatility of political rhetoric, several economic factors suggest the USMCA/CUSMA framework will survive. CBC notes that the costs of scrapping the deal would be prohibitive. The North American trade bloc is one of the most integrated in the world, and a sudden return to tariffs or the absence of a formal agreement would trigger immediate price spikes for consumers and production delays for manufacturers.

“Trump is unlikely to rip up CUSMA, his trade deal with Canada and Mexico,” according to CBC analysis, citing the inherent risks to U.S. industrial stability.

The automotive industry serves as the primary example of this interdependence. A single car part may cross the U.S.-Canada or U.S.-Mexico border multiple times before the final vehicle is assembled. Imposing tariffs or removing the rules-of-origin protections provided by CUSMA would increase costs for U.S. automakers and potentially lead to job losses in the American Midwest.

Additionally, the U.S. views CUSMA as a strategic tool to counter the economic influence of China in the Western Hemisphere. A fragmented North American trade zone would weaken the U.S. position in global trade competitions, making the maintenance of the deal a matter of national security as well as economic policy.

Common misconceptions about the CUSMA review process

There is a frequent misunderstanding that the 2026 review is a “renegotiation” in the same vein as the transition from NAFTA to CUSMA. In reality, the review is designed as a check-in to ensure the agreement is functioning as intended. However, the political climate can turn a routine review into a high-stakes negotiation if one party decides to use the date as a deadline for new demands.

Another misconception is that tariffs are a simple “on-off” switch. While a president can impose tariffs through executive action, these moves often face legal challenges from domestic industries and can trigger retaliatory tariffs from Canada, which would hurt U.S. exporters. This “tit-for-tat” dynamic often acts as a deterrent against the most extreme trade measures.

To understand the broader context of these trade dynamics, readers may find a related explainer on the history of NAFTA and USMCA useful for seeing how these agreements have evolved over three decades.

What are the potential risks for the Canadian economy?

While the likelihood of a total collapse of CUSMA is low, the risk of “targeted volatility” remains high. This could manifest as specific disputes over dairy quotas, lumber tariffs, or digital services taxes. If the U.S. administration decides to target a specific sector to gain leverage in other areas, the impact could be severe for those industries.

The Canadian economy is uniquely exposed due to the concentration of its exports to the U.S. market. Any significant disruption in trade flow—even if temporary—can lead to market instability and reduced investment in capital-intensive sectors like mining and manufacturing.

The strategy of “not being an idle spectator,” as described by Minister LeBlanc, involves diversifying trade partners through other agreements (such as the CPTPP) while simultaneously reinforcing the U.S. partnership. This creates a hedge against over-reliance on a single trade partner.

How do the different news perspectives compare?

The coverage of this story across various outlets reveals a contrast in framing. CTV News focuses on the diplomatic optimism provided by Ambassador Hoekstra, emphasizing the “working together” narrative. In contrast, The Globe and Mail highlights the internal contradictions of the U.S. administration, focusing on the volatility of the rhetoric.

While Global News and the Toronto Star focus on the actionable responses from the Canadian side—specifically the federal government’s proactive stance and the provincial networking strategy—CBC provides the structural analysis, arguing that economic reality outweighs political threats.

This divergence shows that while the diplomatic surface is calm (Hoekstra), the political layer is volatile (Trump), the strategic layer is active (LeBlanc/Carney), and the economic layer is stable (CBC analysis).

Frequently Asked Questions

What is CUSMA/USMCA?

The Canada-United States-Mexico Agreement (CUSMA), known as the USMCA in the U.S., is a trade agreement between the three North American nations. It replaced the North American Free Trade Agreement (NAFTA) and governs tariffs, intellectual property, and labor standards across the region.

Why is the U.S. Ambassador’s comment important?

The statement that the U.S. and Canada “know how to work together” is seen as an attempt to reassure markets and the Canadian government that the upcoming 2026 trade review will be handled through professional diplomacy rather than aggressive volatility.

Will Canada face new tariffs?

While there have been threats of tariffs from the U.S. administration, experts cited by CBC suggest a total dismantling of the trade deal is unlikely due to integrated supply chains. However, targeted tariffs on specific goods remain a possibility as a negotiating tactic.

What is the “sunset clause” in the trade deal?

The sunset clause is a provision in CUSMA that requires the three member nations to review the agreement every six years. If the parties agree, the deal is extended; if they cannot agree, it could potentially expire or be renegotiated.

Why are Canadian premiers being told to network with U.S. governors?

According to Mark Carney, sub-national diplomacy creates regional economic dependencies that can protect trade interests. If U.S. state governors rely on Canadian imports, they can lobby their own federal government to avoid harmful tariffs.

As the 2026 review date approaches, the tension between diplomatic assurances and political rhetoric will likely increase. The ability of Canada to maintain its “active spectator” status while leveraging provincial ties will be critical in determining whether the partnership remains stable or enters a period of significant disruption. For more on how this affects specific industries, see our analysis of North American automotive supply chains.