Trump says he is cutting off trade talks with Canada

US President Donald Trump said he reduced trade discussions with Canada “immediately” while the country is trying to start applying a tax policy targeting large technological companies.

The last decision, which he announced on social networks, comes when neighboring nations worked to agree on a trade agreement in mid-July.

The two countries have imposed prices on the goods of the other after Trump launched a trade war earlier this year and threatened to annex Canada using “economic force”.

On Friday, the American president said that he ended the talks because of what he called a “blatant tax” on technological companies and added that he would announce new prices on the goods crossing the border in next week.

“We are putting at the end of all discussions on trade with Canada, with immediate effect,” he wrote on social networks.

“We will get to know the price in Canada that they will pay to do business with the United States of America in the next seven days.”

Later in the oval office, President Trump told journalists that the United States had “all the cards”.

“Economically, we have such power over Canada. I prefer not to use it,” he added.

In brief comments to journalists, Prime Minister Mark Carney suggested that talks were setting up.

“We will continue to carry out these complex negotiations in the best interests of Canadians,” he said.

The digital service tax of 3% of Canada has been a collision point in its relationship with the United States since the promulgation of the law last year. The first payments are due on Monday.

Business groups believe that it will cost American companies, such as Amazon, Apple and Google, more than $ 2 billion per year. Other countries have a similar tax in place, including the United Kingdom, France and Italy.

Canadian officials said they expected to resolve the issue in the United States’ trade negotiations.

There was hope that the relatively warm relationship that Carney newly elected forged with Trump could help these negotiations.

The president’s latest move has a doubt about a future agreement, although Trump has often used threats to social networks to try to take a lever effect in talks or speed up the negotiations he considers a point of view.

Last month, for example, he threatened to widen prices on goods arriving at Us Shores of the European Union, to give in to yield a few days later.

Candace Laing, director general of the Canadian Chamber of Commerce, who criticized the digital services tax, said that “last -minute surprises should be expected” as the deadline for an agreement is approaching.

“The tone and the tenor of the talks have improved in recent months, and we hope to see the progress is continuing,” she added.

Canadian Senator Hassan Yussuff, who sits on Canada-US Commercial Advisory Council to Prime Minister Carney, told the Globe and Mail that he thought Trump tries to take a “lever effect” in talks by pressure on Canada.

“I think we don’t react,” said Yussiff.

Meanwhile, some in the business world of Canada called Carney to remove the digital services tax. Goldy Hyder, President of the Canada Business Council, said on Friday that the tax is undergoing Canada’s relations with the United States, and that it should be lifted “to recover trade negotiations on the right track”.

In the G7 in mid-June, Trump and Carney had established a deadline of 30 days for a trade agreement to be concluded. It is not clear if Trump’s latest comments affected this calendar.

During Trump’s first term, the White House fought hard while many countries began to consider taxes on digital services.

But the Inu Malak, a member of the trade policy of the foreign relations council, noted that the question was not resolved in the trade agreement that the United States and the United Kingdom have reached earlier this year, suggesting a certain flexibility.

She said Trump’s threat seemed to be a decision to increase the pressure of her “game manual – but was also a sign that the president had refocused on Canada, which could open the way to an agreement.

“It provides a little opening-perhaps not the one that Prime Minister Carney wanted … but it provides them with a little space to accelerate these talks,” she said.

The United States is Canada’s best trading partner, buying more than $ 400 billion in goods last year as part of a long-standing free trade agreement.

But Trump struck this business with a new price of 25% earlier this year, citing concerns about drug trafficking at the border.

The new American prices on cars, steel and aluminum have also blurred relationships. Automobile parts, for example, cross the Mexican and Canadian borders and borders several times before a vehicle is completely assembled and these import taxes threaten supply chains.

Trump then dug exemptions for certain goods in the face of a widespread alarm from companies in the United States and Canada, which retaliated with prices on certain American products.

The United States’s shares fell on Friday after Trump said he had cut off the talks, but then bounced with the S&P 500 closed to a record.