The CUSMA chessboard: decoding the Trump-Carney rivalry as a pre-negotiation strategy 

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To our valued clients and partners,

 

If you’ve been watching the news over the last eight days, you’ve likely seen a whiplash-inducing shift in Canada-U.S. relations. On January 16, President Trump was praising Prime Minister Mark Carney for a preliminary trade deal with China. A week later, he was threatening Canada with 100% across-the-board tariffs and calling our Prime Minister “Governor Carney”.

 

A big part of my job at JORI is to look past the rhetoric and help our team and clients navigate the reality of the supply chain. I don’t claim to be a foreign policy academic, but I am an expert observer with skin in the game. Every day, our business lives and breathes the logistics of this border, and from my perspective, the media is missing the real story.

 

While the headlines are dominated by the China-Canada trade “spat,” we believe this is the first salvo of the upcoming intense CUSMA 2026 renegotiations. It is no secret that Canada is deeply dependent on maintaining a positive trade relationship with the U.S.. It is also no secret that Canada currently lacks traditional leverage as we approach the mandatory CUSMA review, which must be completed by July 1, 2026.

 

I’ve reframed the situation below through the lens of this upcoming CUSMA renewal. This is not a commentary on where the approaches of the two leaders are good or bad but rather provides some more context to the situation.

 

This is our opinion, based on what we see on the ground, and I encourage you to use this context to draw your own conclusions as you make strategic decisions for your business.

The grand strategy: manufacturing leverage

Carney’s primary objective is to secure a long-lasting trade agreement without surrendering critical sovereignty or economic concessions. Conversely, Trump’s objective is to use the threat of economic crippling to force Canada into absolute compliance with his broader agenda. However, Carney is effectively manufacturing leverage by identifying several “Achilles heels” in the U.S. position:

 

  1. Geopolitical proximity: The U.S. will not tolerate China as a dominant player in its North American “backyard”.
  2. The golden dome: Trump’s signature legacy project—the $175 billion “Golden Dome” missile shield—requires Canadian Arctic airspace and cooperation to be fully effective.
  3. Mid-term strategy: President Trump has made it clear he wants a strong economy heading into the 2026 mid-terms to sustain a majority in Congress and the Senate.
  4. Legal uncertainty: A pending Supreme Court decision (Learning Resources, Inc. v. Trump) could significantly weaken the President’s legal authority to impose unilateral “emergency” tariffs.

 

1. The “only language he respects” theory

Mark Carney is an elite central banker—the exact “globalist” archetype the Trump administration often targets. Carney understands that traditional diplomacy won’t work in this era.

 

  • The strength play: By securing a $7 billion deal in Beijing and then delivering a defiant speech at Davos about “middle-power resistance,” Carney is signaling that Canada is a “tough negotiator”—a trait Trump historically respects.
  • The goal: From our view, Carney is establishing a baseline: Canada has other options. He intends to enter the CUSMA review as a formidable peer, not a subordinate.

 

2. The “Golden Dome” as ultimate leverage

Our belief is that the real friction is about Greenland and Arctic defense. If this were purely about China, Trump’s initial reaction on January 16 would have been hostile, not positive.

 

  • The power move: Canada controls the Arctic airspace essential for the Golden Dome. By initially saying “No” to protect sovereignty, Carney is creating a massive bargaining chip for the trade table.
  • The trade-off: Carney’s likely end-game is to trade Arctic cooperation for a better deal on CUSMA and clear exemptions from future “America First” tariffs.

 

3. The China deal as a disposable pawn

We believe the China deal—which currently includes lower tariffs on Chinese EVs—is largely “negotiating leverage“.

 

  • The play: Carney can “concede” on this later, canceling the China deal to give Trump a major public “win” just in time for the U.S. mid-terms.
  • The win: Trump gets to claim he stopped a Chinese “takeover,” while Carney walks away with the long-term CUSMA stability Canada needs.

Our advice: signal vs. noise

As someone with skin in the game, I recommend the following posture as you evaluate your own business strategy:

 

  1. Don’t panic: These 100% tariff threats are negotiating offers and part of the pre-July 1st posturing, not implemented laws.
  2. Stay agile: Ensure your supply chain data is clean and maintain clear visibility on your Rules of Origin documentation to mitigate potential disruptions.
  3. Wait and see: We expect the rhetoric to stay hot until the formal CUSMA review begins this summer.
  4. Action vs. words: We’ll be monitoring the situation for what actually transpires in actions, not just in words. It is vital to separate the “noise” of social media posts from the “signal” of actual trade policy.

 

We are monitoring the situation and will keep you informed of any actual regulatory shifts. Remember: in a trade war of words, the loudest voice isn’t always the one that wins the deal.

 

Best regards,

Sam Woods, President, JORI Logistics