Mark Carney Speaks to Canadians After Trade Talks With U.S. Collapse

The morning after he pulled negotiators from trade talks in Washington and set off a new round of American tariffs, Prime Minister Mark Carney on Saturday explained to Canadians why he walked away, calling the U.S. proposal “a bad deal.”

“We’ve recognized from the start that America has changed,” Mr. Carney said. “We recognize that sometimes, its signature is written in pencil.”

“We cannot accept what they offered and we will not give what they asked,” he added. “We were not prepared to compromise Canada’s sovereignty or undermine our key industries.”

The latest U.S. tariffs, he said, “are designed to hurt and divide us. They are a miscalculation because Canadians will always take care of each other. We know we’re stronger together.”

On Friday night Mr. Carney blamed unspecified last-minute demands for the collapse of negotiations, saying that they were “unfair, uneconomic and called into question the reliability of any deal.” Minutes later, the United States went ahead with previous plans and introduced 50 percent tariffs on $20 billion worth of Canadian exports.

Mr. Carney immediately promised that Canada will retaliate “dollar for dollar.”

On Saturday, he said that American negotiators “asked too much and offered too little.”

His decision to stand up to President Trump and walk away from negotiations is the latest fracture in the once-close ties between the countries. The relationship has drastically deteriorated since Mr. Trump returned to office, where he has targeted Canada with tariffs, insulted its leaders, and repeatedly proposed that it be annexed as the 51st state.

Mr. Trump’s trade actions have prompted widespread anger and fear among Canadians.

The trade negotiations began in late July in a bid to ward off the new tariffs and to reverse or at least reduce U.S. tariffs of up to 50 percent on the key auto, steel and aluminum sectors that were introduced last year.

As he did on Friday night, Mr. Carney suggested that Canada will now double down on its strategy of disengaging from the U.S. economy, expanding trade with other countries and diversifying Canada’s economy.

“Last spring, I warned that America is trying to break us so that they can own us and I promised: ‘That will never, ever happen.’” Mr. Carney said “We are keeping that promise. Canada is becoming stronger and less dependent on America.”

Unlike the previous tariffs, the new U.S. measures affect a more varied array of business sectors, although they disproportionately target building materials like plywood and tissue used for toilet paper, which are significant exports for the forestry industry. Canadian alcohol is also singled out.

The new American tariffs only cover a small portion of the $382 billion worth of products the United States imported from Canada last year, in part because they conspicuously avoid oil, gas, electricity imports as well as potash, a key fertilizer not mined in significantly quantities in the United States.

But many of the items hit with tariffs, like men’s suits and honey, are often produced by small businesses that will likely be unable to withstand any significant loss of business.

Mr. Carney promised 25 billion Canadian dollars in financial blockistance to affected companies.

Exactly how Canada will retaliate without creating further headaches for Canadian businesses was not clear. Many manufacturers in Canada rely on supplies and materials which generally cannot be readily or economically purchased elsewhere. Canada’s much smaller economic footprint also limits its ability to inflict significant economic pain on the United States.

Mr. Carney said that Canada is moving ahead on retaliation “reluctantly, because we recognize that it will raise costs and reduce choice for Canadians. Reluctantly, because we recognize that some U. S. companies and states are innocent bystanders in a dispute they did not want.”

He added: “We take this step confident that it is in the best interests of Canada and that by rejecting a bad deal, by standing up for Canada and by focusing on what we can control, we will build Canada strong for all.”

Doug Ford, the premier of Ontario, the most populous province, urged Mr. Carney to look at using oil, gas and electricity as trade weapons in a letter this week. Mr. Carney previously downplayed that idea saying it would jeopardize Canada’s reputation for reliability. But polls show widespread support for export taxes on energy.

And on Saturday, after outlining the United States’ energy dependence on Canada, Mr. Carney added: “I don’t think they want us to stop sending it.”