President Donald Trump said on Thursday that completing a trade agreement with Canada could be jeopardized after Ottawa declared its intention to recognize a Palestinian state at the United Nations in September.
Canadian Prime Minister Mark Carney announced the shift on Wednesday, following similar decisions by France and the United Kingdom. The move drew swift objections from both Israel and the United States.
Roughly 12 hours after Canada’s announcement, President Trump responded on his social media platform, Truth Social: “Wow! Canada has just announced that it is backing statehood for Palestine. That will make it very hard for us to make a Trade Deal with them. Oh’ Canada!!!”
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His warning came just ahead of the August 1 deadline for countries to secure trade agreements with the United States or face steep new import duties. Trump’s so-called “Liberation Day” tariffs—set at 35%—will apply to nations that have not reached updated deals with Washington. While allies such as the United Kingdom, Japan, South Korea, and the European Union have finalized agreements, countries like China and Mexico have yet to do so.
Carney said discussions with the Trump administration over a revised bilateral deal have been “constructive” but warned that talks may not wrap up before the deadline.
Canada’s decision to support Palestinian statehood represents a break from its past policy, complicating negotiations with its top trading partner. While over 140 nations already recognize Palestinian statehood, both the US and Israel maintain that any resolution should come through direct negotiations with Israel.