US-Canada Trade Tensions Rise Over Palestine Move

Canadian Prime Minister Mark Carney has announced Canada's intention to recognize Palestinian statehood at the UN General Assembly in September, contingent on Palestinian Authority reforms and excluding Hamas from governance. This aligns with recent moves by France and the UK amid international criticism of Israel's actions in Gaza. In response, U.S. President Donald Trump threatened to complicate or stall ongoing U.S.-Canada trade negotiations and reiterated his willingness to impose a 35% tariff on Canadian goods not already covered by USMCA if no deal is reached by his August 1 deadline. Trump argued that recognizing Palestinian statehood would reward Hamas, leveraging tariff threats to influence allied foreign policy. Canadian officials stress their independent approach to foreign policy but acknowledge the risk of prolonged trade uncertainty. The dispute underscores rising geopolitical tensions and the intertwining of trade with diplomatic priorities among Western allies.