Association project with Canada: Trump threatens to stop trade with the EU
WASHINGTON — After escalating his trade war Wednesday, U.S. President Donald Trump said if Canada becomes the first associate member of the European Union, it could constitute a "hostile act."
Speaking to reporters in North Carolina, the president said that if the decision was made with “bad intentions,” he would impose “very high tariffs” on Europe.
Donald Trump also called Canada a "poor trading partner" after signing a memorandum earlier in the day ordering federal agencies responsible for public procurement in the United States to withdraw all products of Canadian origin from the market.
“President Trump is taking action to hold Canada accountable for its continued unreasonable and discriminatory treatment of American products, which penalizes American workers,” a White House fact sheet says.
A White House official, speaking on condition of anonymity, clarified that this decree was not linked to strengthening ties between the European Union and Canada.
Earlier today, Prime Minister Mark Carney had a front row seat to European Commission President Ursula von der Leyen's State of the European Union address, which outlined the case for strengthening relations.
She said both sides needed to “urgently rethink” their partnership and move beyond a free trade deal to take their relationship to the “highest possible level”.
Mr Carney is due to address the European Parliament on Thursday. According to official sources, the two parties are continuing their discussions on the definition of a strengthened partnership.
An alternative would be much worse
Canada-US relations were shaken by Donald Trump's return to the White House last year, with ever-changing tariffs targeting the United States' northern neighbor. But the trade war led by Donald Trump has intensified in recent weeks after the failure of negotiations between the two countries.
Mr. Carney warned that refocusing Canada away from the United States would have a cost, but that the alternative would be far worse.
To justify his latest initiative, Trump's executive order cites Ottawa's "Buy Canadian" policy, launched, along with similar measures taken by some provinces, after the president imposed tariffs on Canada and threatened to annex it.
The executive order states that Canada has “unreasonably imposed new barriers on U.S. companies seeking access to the Canadian government procurement market.”
“My administration will always act to combat such unreasonable or discriminatory practices,” the decree states.
The latter also indicates that the US Trade Representative will monitor circumstances that may require additional measures. It specifies that the department will also inform the president if goods can be returned following a change in Canadian government policy ending the current treatment of products of American origin.
It is currently unknown which products would be affected by this supply policy. Donald Trump's executive order indicates that the measure would affect access to goods that the United States has agreed to cover at the federal level under the World Trade Organization Agreement on Government Procurement, for an annual amount of more than $280 billion.
Buy American
Last week, Donald Trump threatened, in a post on social networks, to withdraw all products of Canadian origin from federal public procurement.
“This is not reciprocity, this is a Canadian business scam,” he wrote of the policy. Buy Canadian”.
This policy, implemented in December 2025, favors Canadian companies for major federal purchases, requires the use of Canadian steel, aluminum and wood in major federal construction and defense projects, and limits non-defense contracts to Canadian companies or international firms from countries offering the same access to Canadian companies.
The United States also has a “Buy American” policy that prioritizes domestic purchasing in key sectors. Former Democratic President Joe Biden implemented a set of protectionist supply rules that Donald Trump has since maintained or strengthened.
Last year, Donald Trump initially imposed tariffs on the entire Canadian economy, citing fentanyl trafficking. Although these rights were struck down by the US Supreme Court, the Trump administration replaced them with a 10% tax linked to forced labor in supply chains.
These customs duties do not apply to goods that comply with the Canada–United States–Mexico Trade Agreement (CUSMA).
Donald Trump also imposes separate sectoral tariffs on Canada, targeting industries such as steel, aluminum, automobiles and cabinetmaking.
Last month, the Trump administration escalated the trade conflict by imposing 50% tariffs on a range of Canadian products, from hockey sticks to honey.
Retaliatory customs duties imposed by Ottawa on certain American products came into force on September 8. The same day, Donald Trump signed executive orders to completely ban imports of certain Canadian products, including motorcycles, certain dairy products and alcoholic beverages, later this month.
This trade war between two former close allies is causing serious concern among companies in the highly integrated North American market.
On Tuesday, the Equipment Distributors Association sent letters to the governors of American states with high exposure to Canadian trade, calling on them to find a solution.
“Our supply chains do not stop at state or national borders. Heavy machinery, agricultural equipment, industrial components and replacement parts routinely cross the Canada-U.S. border multiple times during their production and distribution,” President and CEO Brian P. McGuire wrote in the letter.
“The continued uncertainty caused by trade disputes will disrupt significant multi-year investments, drive up the cost of equipment and directly threaten local jobs.”
