The Agenda with Steve Paikin (Audio) - How Should Canada Handle CUSMA & Trump?

Episode Date: June 18, 2026

Prime Minister Mark Carney met with world leaders at the G7 in France, trying to position Canada in an increasingly uncertain global order, new questions are emerging about the country's economic stability and its most critical trade relationship. U.S. President Donald Trump has cast doubt on the future of the Canada-U.S.-Mexico Agreement, saying "I'm not looking to renew it" and "we don't need anything that Canada has," with a key deadline approaching. How exposed is Canada if that deal unravels, and how should its foreign and economic strategy adapt? Arif Lalani, Shannon Gormley, Adam Chapnick, and Drew Fagan join Jeyan to discuss.See omnystudio.com/listener for privacy information.

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That was one of the big questions hanging over this year's summit in France. Now, Prime Minister Mark Carney was asked whether this gathering could help shape a new world order, and he made a point of mentioning all the leaders who'd be there, not just the ones from the G7. And it's a recognition that the G7, if it ever did run the world, no longer runs the world or pretends to. So what did this year's summit reveal

about how global power is shifting and what role this country will play? We break down the top G7 takeaways for Canada. Then, July 1st is getting closer and closer. That's the deadline to renew or review the Canada-U.S.-Mexico agreement. We look. At present, Trump's threats to pull out and what they mean for trade negotiations.

Welcome to the rundown. Prime Minister Mark Carney has been in France this week for the G7 summit, meeting with foreign leaders and trying to chart a new path for Canada in uncertain times. Arif Lulani is a former Canadian ambassador to several countries in the Middle East. Adam Chapnik is a professor of defense studies at the Royal Military College of Canada. and Shannon Gormley is a foreign affairs columnist. Thank you so much for joining us in our studios. Welcome back to both of you.

Adam, great to see you. Adam, I'm going to come to you first. What was the biggest takeaway for you from the G7 summit? For me, I think what matters at these summits are not as much the meetings among the G7, but who people are meeting with on the side. And what I found fascinating this time is that Mr. Carney took more side-level meetings with non-G-7 countries than he did with G7 countries while he was there. You saw the Koreans, the India,

UAE, Ukraine, and a couple of G7 countries. But it goes to show that part of the point of these meetings are not just the G7. It's access to other people who are in the international community who matter to Canada. Shannon, for you? I was actually pretty struck by how the most prosperous countries in the world right now have to turn themselves into pretzels

to try to manage the behavior of a toddler who happens to be in charge of the United States of America. And so tonight, Trump is going to have a FET at Versailles because they're so worried about managing his ego. And so that's one element of it. But I was also really struck by the fact that most of the leaders in the G7 right now are quite beleaguered. And so there is a real opportunity right now for Carney and for Canada's leadership to take a more central role. So if you look at the UK right now, Starmer is concerned that by the time he returns home, they will have changed the locks on number 10.

Mertz is in trouble because they've lost their bid for a temporary security council seat. And on top of that, France, Macron, is in his last term. So he's a lame duck. And so that's something that I think people are looking for leadership. and Carney had a vacuum to fill. All right, Arif, biggest takeaways here. Well, look, I just observe, you know you're in trouble when Italy seems to be the most stable government in Europe, right?

So I agree with your point. You know, I think the takeaway from me was that G7 is a very powerful club, but it's no longer the governing board of the world. Why do you say that? Well, it used to be that the G7 set the policy for the world, and today that's not the case. The G7 is searching for relevancy, right? and the relevancy is by inviting others.

So to Adam's point, you know, the G7 doesn't matter if India isn't invited, if the Gulf states aren't invited, and if others aren't invited. So I think now the G7 is just a very important club, but it doesn't set the table. There are many competing groupings like BRICS Plus, Brazil, Russia, India, China, and South Africa, and new members, the G20, the Shanghai Cooperation Organization, And so the G7 is now just one amongst many.

Shannon, what are your thoughts on that? You know, when we're talking about, you know, for example, India, not a member, China, second largest economy here, when we really look at Asian representation in the G7, it's really just Japan. Are there some missing pieces in terms of its relevancy? Well, I don't think there's anything wrong with the most prosperous democracies in the world coming together and trying to make deals and coordinate their actions. But at the same time, it's very clear, particularly with Trump, who's accelerated this,

is that all countries, all like-minded democracies, need to start looking elsewhere for trade deals and even for security agreements. Now, the extent to which we can do that without harming our own national security interests is an open question. That's something to be managed. Adam, any opportunities that you felt Canada failed to capitalize on? I don't think so, but I also would say that I'm not. sure that we can figure that out right now.

Part of the G7, to me, is not a place where things get finalized. It's a place where relationships are built, where Mr. Carney can accelerate trade with India, but you don't sign a trade deal with India while you're there. So it's hard to know without being in the room for those sidebar conversations how well they went and therefore, if any opportunities were missed. But it seems to me that the prime minister stayed busy, which is the point. If you're going to be there, you meet with as many people as you can that can help Canada's interest in the grand scheme. So it's hard with what we know so far to say that opportunities

were really missed. Arif? I don't think there were any opportunities missed. I think the Prime Minister is executing the best foreign policy that's available to him. And I'd add he's doing it without having these endless policy reviews and deliberations. He's actually leading by execution, which I think is a good thing. So I don't think so. I think it was a no-drama G7. which with President Trump is itself an achievement. He didn't leave early. He showed up. So I think for President Macron also,

he sort of escapes the summit without having any major drama. Shannon, on the point that Adam made about Mark Carney's leadership, right before the G7 summit, Mark Carney advocated for a third path for middle-power nations, arguing that countries like Canada should build more pragmatic coalitions rather than simply competing for favor of major powers. Is that the sensible path forward? I think it's the best path available to us right now,

given the unpredictable, mendacious behavior of our biggest trading partner. And to a certain extent, we can only detach ourselves from the United States to a small degree, but he's still trying to do it to whatever extent that we can. Now, whether or not we're, striking the right balance in the relationships that we're pursuing on a trade level with other countries. I'm not always so sure about that. I mean, for instance, he used his time

with India at the G7 to invite India for a visit. And just three years ago, a Sikh person was murdered on Canadian soil. Just six months ago, I believe it was the head of the Federation of Canadian Sikhs. He was threatened and his wife and children were threatened. And so balancing Canada's very real need right now to have, to forge more trade relationships, we need to be able to do that in a way that doesn't come at the expense of national security. And I'm not sure that we are striking that balance. Adam? I think we have to be able to walk and chew gum at the same time. India is just too big of an economy to ignore, particularly when the Indians are desperate for more trading partners and therefore are going to be much more malleable in what they will

accept and not accept compared to other times in our history. They're also desperate for stable, reliable trading partners, and we're one of the few available. So yes, we have to be cautious. Yes, CESIS has to be paying close attention, but we can't ignore India right now. I just want to quickly interject there. I agree with everything you said. at the same time, I think that we've also announced that we're going to be exploring more intelligence sharing with India. So that's cooperating and cooperating on the security front. And so that's where we have to be, I think, really careful in balancing those two things. All right.

I want to change gears a little bit. Another topic of discussion, Iran. A re-criticism from some quarters of Canada that the country could have played a bigger role in the peace talks there. Agree? disagree? I don't think there was a bigger role to be played. And I think one of the strengths of the prime minister at the moment is not to overplay Canada's hand. And what would Canada have done? I think there's a role for Canada now if there is really a memorandum of understanding that holds to Friday and beyond is for us to use some of our naval and high-tech assets to help

secure the straight. But if it was me, I would be staying out of this huge strategic miscalculation by the United States and Israel. I mean, it's been a complete disaster for the world. Adam? I think that we have a tendency in Canada historically to look for places to lead, to insert ourselves. And I think we shouldn't be doing that. We're at our best if we are asked to intervene and then we say yes and do a good job. looking, you know, me, me, me, please, is not, that's not helpful.

That's actually, you're in it for yourself. So we weren't asked to do more on Iran, and we didn't do more, and that makes perfect sense to me. Being humble is not a bad thing in world affairs. So can I just also add, it's also wasn't in our interest, right? So I think also the days of when Canada looks to play a good role, or I think we'd just be driven by what was in our interest. and it wasn't in our interest to try and seek a greater role. Whose interest was it at? For Canada to seek a greater role, do you mean?

I don't think it was in anyone's interest for Canada to play a greater role. I think it was in our interest to provide good, honest counsel to the Americans behind the scenes in terms of how to navigate out of this, which in my mind would include bringing the Chinese. in more to guarantee whatever is going to be agreed. And I suspect Canada was providing that advice behind the scenes. Shannon? I don't know why Canada would want to have a role in a mess that it wanted to have nothing to do with. So this was a mess of Trump's own creation.

It was entirely unnecessary. It was executed badly, but there probably wasn't a way it could have been executed well. I think most of the world just wanted it over with. I'm glad it was over with, but I don't know that Canada could have done much aside from what Arrived just said to provide counsel. Yeah, and look, the prime minister had a couple of missteps on this issue. He came out early and supported the attacks by Israel and the United States and then tried to backtrack and then tried to explain. So I think for him politically, the best thing was to keep his head down. All right. I want to talk about Ukraine.

Trump was on record saying that the war in Ukraine has no impact on the U.S., other than saying that, We sell weapons and that they are thousands of miles away. Was this an opportunity for Canada to reassert its support for Ukraine? I think we did reassert our support. I think we've increased the number of folks that were sanctioning. We've increased the amount of money that's going to support Ukraine. We had another meeting with President Zelensky that, by all accounts, seems to have gone very well. So I think we did that.

And I think sometimes the president says things that one has to accept with a grain of salt. In that very moment, he might not have been doing much more with Ukraine, but an hour later he might have been, and we have to just accept that and move on. And did Canada rise to the occasion there? I mean, I want to be careful about congratulating any country other than Ukraine right now because the fact is that this war is being fought by people who have proven that they know what they're doing. And if they had more weapons, if they had the right kind of weapons, it may have been over by now in the Ukraine.

favor. Canada has, Karni in particular, has congratulated Canada for giving more aid than we, in fact, have given. But this is certainly a step in the right direction. Arif? So you're nodding your head there. Well, I agree with Shannon. I think the Ukrainians themselves deserve a lot of credit.

I mean, a year ago, people were counting them out, and they've managed to keep fighting, to keep disciplined, and to start to turn the tide. even while, you know, with a hand tied behind their backs in terms of the assistance not being received by the U.S. and European. So I think now is the time to do more for Ukraine and to pressure the Americans to not cut the rug out from under the Ukrainians in terms of their own relationship with Russia. With that being said, Adam, I think I know what you're going to say to this.

But what are some areas that you think Canada can take a lead globally? I don't think we should be looking to take a lead. I think that we should be prepared to do a disproportionate amount when directly asked because our allies believe that we have something additional to give that they don't have.

And when that ask, if that ask, or when that ask comes, we should be up and about ready to go. But I don't think that, we've mentioned our interests. Leadership is not a national interest. Leadership may be a means to a national interest,

but it is not in and of itself. Just leading doesn't necessarily put us in a better place. So I think we become obsessed in this country with leadership in foreign policy where really we need to be obsessed with outcomes in foreign policy. Aref? I think we just need to be a strong country, which we're trying to be.

So I think the leadership here that Canada does have is frankly to be an adult at the table. This is a system where our not... natural leadership points, the Americans and others, are not in a position to do that. So I think Prime Minister Carney brings, you know, real kind of experience to the table. And I think the other thing that Canada can do is speak up for what's right and back it up. And he has so far been able to do that on Ukraine, on Gaza, on the Middle East in general, on AI, on teens and social media.

I mean, I think people are looking for countries who are addressing complex problems with some maturity and some thoughtfulness. And I think we now have a prime minister who's in that camp. Jen? I think to a large extent, we're going to lead by example,

if we're going to lead by at all. at all. I think that, as our friend O'Reaf just said, people want an adult at the table right now, and other countries do watch that. And so when Canada's prime minister, who's on a high right now, not just domestically, but internationally, when he is refraining from scapegoating the media, when he observes democratic norms, that can be infectious. And so we don't want to overstate the extent to which that can be infectious, but just as authoritarian systems rely on other authoritarians to project strength in their system, so do democracies.

Adam, Carney left the G7 without a formal meeting with the president, President Trump. Carney has said that he had spoken with Trump seven or eight times over the past 36 hours and shouldn't really read into the fact that he didn't have a formal meeting. How should Canada navigate an unpredictable USA? I think that's the kindest way I think I can put it. But how do we navigate this?

Well, I think one thing you don't do is going begging publicly for a meeting. So if there's no meeting to be had, that should just be fine, as the Prime Minister seemed to indicate that it was. I think that we have to recognize that it is an America's interest to collaborate with Canada and with Mexico. We all benefit, we all grow, we all prosper when that happens. the Americans will realize that, more of them at some times than another. And when the Americans are in a position where they're realizing that more often than not,

we have to be able to jump and get things done quickly. When they aren't in the mood to discuss that, we have to just keep going, continue to prepare, and be ready when it happens. The numbers are very clear. All of our economies will grow more quickly if we work together. I should mention that U.S.S. Trade Minister, Canada, U.S. Trade Minister, Dominic LeBolk did meet with the counterparts in the U.S. What are your thoughts there?

I think leaders meet either to launch a process or to close a process. And there was nothing here to launch or nothing to close. So I think it really wasn't an issue that they met or didn't meet. I think the officials are carrying on the discussions. And frankly, I think with President Trump, a meeting with President Trump is usually sort of the last resort, not the first resort, because it's very unpredictable. All right.

I think all eyes are on July 1st. and sort of ticking towards that deadline. How do we deal with an unpredictable counterpart in the States? Well, I don't know this for a fact, but I don't very much that Carney wanted to meet with Trump. I think right now, doing anything to not rock the apple cart is what we're trying to do. So as many meetings as can be done that not sideline him,

but that don't cause a peak or a fit from him. that's probably in our interest. Shannon, Arif, Adam, thank you so much for this. Really appreciate it. Thank you. Thank you. Thank you. U.S. President Donald Trump has made it pretty clear he's no fan of the Canada-U.S.-Mexico agreement.

Well, I'm not looking to renew it. We don't need anything that Canada has. Now, he said that last week, with a critical deadline looming. So what does that mean for the future of this trade deal? Drew Fagan. is a professor at the Monk School of Global Affairs and Public Policy at the University of Toronto. And he joins me in studio. How are you doing, sir? Hey, Jan.

All right, with about two weeks to go before the July 1st deadline, it's the million-dollar question. What do you think Trump will do on Kuzma? So I think we're not going to have an answer by July 1st by any means. I'm not even sure we'll have an answer one way or the other in the fall or even into 2027. July 1st is really an assessment point, more than a dead thing. line. Basically, it means the three parties come together and check where they're at, and then technically decide, yay or nay, on whether the agreement should be extended for another six years. That doesn't mean six years from now. That means 2036 to 2042. Trade agreements think

long term. I think it's likely that that's not going to happen, either now or into the fault. And we're going to be into almost an elongated, possibly constant process of negotiations, given the way the Trump administration plays this kind of thing. With that being said, what should Canada's strategy be? Well, so one, don't overreact. All the senior officials know that. Don't take the bait. And that's a logical thing to do because we've been doing that for a long, long time. And Kuzma's as big as stakes get with regard to Canada, U.S. relations. Then there's the issue of some degree of national unity. You think back to the free trade agreement in the 80s, NAFTA in the 90s, Kuzma in Trump won, as we call it. It was important that the

little guy, that's us, we're not a small economy. We're the 10th biggest economy in the world, but they're the big guy. They're the big dog. We need to speak with one voice. And that's hard given the size of the country and the many economies within it. It's up to the prime minister and his team to ensure that the premier's business, if they're not on one page, they understand where everybody's out and where everybody's at and where the tradeoffs are, and that is happening. We've seen with Premier Doug Ford singing sort of a different tune. Is that what that's signaling towards?

Absolutely. He's a bit of an unknowable, but I think lately he's become a little bit more disciplined and a little bit more of the team. He played an interesting role early as kind of this Captain Canada thing. That was in part during the period between Trudeau and Carney, and he became the voice. Now, Carney, disciplined, focused, policy wonk is really in charge. And I think you can see that coming to the fore. And he's going to have to make some tough decisions on the give and take in the context of how big the country is and how many economies there are.

Well, let's talk about that. What's the best case scenario for Canada? Canada here. Is it, for example, the existing tariffs being removed or is there more on the table? So the existing tariffs, the Trump administration insists, will not be removed. The first point is they only exist on a small percentage of Canadian exports to the United States, 10 to 15%. So they haven't been devastating. And the Trump administration, however problematic they are, up until now, has respected by and large the technical terms of Kuzma. So Washington insists some tariffs will remain.

We want to get those down. In the first negotiation of Kuzma in 2018, we managed to get tariffs that were applied to the same products off. Washington insists not. And then it's an issue of getting a deal as quickly as possible, given the uncertainty, and I do think it's going to take a while that is close to the status quo. I say close to because there's probably going to be some gives that we're going to have to make to get that. Well, let's talk about those. What are some of the compromises that Canada might have to make? Well, you've already seen one with regard to online streaming. And the issue of culture and the degree

to which Canada views culture as something of national sovereignty and the United States views it as entertainment, that's been an issue going back to the original free trade agreements. So the step the prime minister and cabinet took last week to limit the kind of tax, if you like, on American streamers that fund additional Canadian production, they step back from that last week. I'd mention a couple of other things. Supply management are dairy and poultry producers. You know, I think that is a give that we made, first of all,

we made it in Trump one. We opened the market, you know, to some extent. It did cost the taxpayer about $3, 4 billion in compensation. The same thing may happen here. and I think the prime minister wouldn't be upset to see that happen because I think he understands very well the fact that it's a bit of a drag on the Canadian economy. The other point is autos.

And that's fundamental, obviously, to Doug Ford. It's not a sector of the future for this country or for that matter, the United States. We have to protect production, assembly, to the extent we can. In that sector, the world beaters, are really the parts producers, less than the assemblers. But we're going to have to balance that out as well.

Worst case scenario here. Don't want to be the negative one here. But if a deal is not reached, what's the impact here on Canada's economy? So the issue of whether a deal is reached is not going to be answered, I don't think, for some time. In some ways, what's perfect for the Trump administration

is to keep, the agreement in place and change it piece by piece over an extended period of time into 27, possibly even past that. We want something quicker, but we know that we want the right deal, you know, and we will take the time necessary. I think that's where they're at right now to get the right deal. So what does the right deal look like? It's not like we don't have cards to play, to use President Trump's term.

critical minerals, energy. The United States needs that. When Trump says, we don't need anything from Canada, it's obviously not true. We have a marginal trade surplus, he complains about. But critical minerals, I think, could be to this agreement, assuming it happens what energy was in the 1980s. They really look to us in a market that,

or mining that funds and is a fundamental part of 21st, the 21st century technological economy and is controlled now by China. So then you get into a conversation between his rhetoric, which sounds like Fortress America and his best interests, we're a little bit more Fortress North America. And that's what we've got to move him to. All right. You mentioned critical minerals.

You've mentioned energy. I'm thinking Ontario. So help me understand a little bit if a deal isn't reached, or if it does go year by year where they get a little bit through negotiations. How does this affect Ontario? Well, the first point I want to make is with regard to Ontario or the Canadian economy general, were less integrated, if you like,

less dependent anyway on the U.S. market than we were, say, 25 years ago. Significantly so. We expressed concern that 70, 75% of our trade is with the United States. That was never viewed as a vulnerability until we got Trump. You know, around 2001, 2002.

it was over 85%. It's close to 88% at its peak. So we're less dependent to a sizable extent. Ontario has always looked to the U.S. market more than other provinces. BC, for example, has always looked to Asia more than other provinces. It's logical.

But autos is fundamental for them. So I go back to the structure or the thinking of Fortress America where Trump views all auto production in Ontario as runaway production, and he's used that term, and a fortress North America approach in which, even if the sector is unlikely to be something that exists in both countries in, say, 50 years,

we're working together to protect it in the context of, say, Chinese imports and things like that. Well, as you mentioned, it looks like this is not going to go away anytime soon, which means that we will probably have to bring you back in to talk about it years down the line as well. Drew, really appreciate it. Always. Thank you so much for your insights. Pleasure.

I'm Jan. Thanks for watching The Rundown. We'd love to know what you think of the show. So send your suggestions and feedback along to rundown at tvo.org. Or you can always leave us a comment on our YouTube page. Until then, I will see you tomorrow. If you're enjoying this series, please consider supporting TVO with a donation to make more insightful and thought-provoking podcast possible. TVO is a registered charity, and you will receive a tax receipt for your gift visit tv.org slash give tv o to make your donation today.