:For over a year and a half Donald Trump has been threatening to kill CUSMA, to let it expire, to tear it up, to use the July 1st deadline as a gun pointed at our nation’s head. There is one problem with that threat. The facts clearly show that CUSMA cannot die on July 1st! That is legally impossible but apparently Trump does not understand trade agreements that he negotiated and said it was the best deal ever.
The documents don’t lie (only people do that) and they clearly state that CUSMA does not expire on July 1st! July 1st is simply a review date, a trigger, not a deadline.
Under article 34.7 of the agreement, if no extension is confirmed, the deal does not collapse. It continues in “annual review mode” for up to 10 more years. The trade deal Trump has been threatening to kill keeps running automatically whether he confirms renewal or not.
It was Donald Trump himself that inserted 34.7 into the agreement during his first term. His own trade negotiators wrote article 34.7. The sunset clause that was supposed to give America leverage over Canada and Mexico, built into CUSMA by the Trump administration in 2018, is the exact mechanism that now prevents Trump from killing the deal on July 1st.
Prime Minister Carney knew this all along through Trump’s constant threats, insults, and numerous other attempts to intimidate us into succumbing to his taunts. Why has this simple fact that any idiot could have discovered by simply reading CUSMA but that would have taken some common sense on America’s part and well, common sense, integrity and class are not something that America has proven good at.
Canada’s trade negotiation team under Prime Minister Carney was aware of this fact all along and have simply allowed Donald Trump to make a fool of himself on yet another front.
Canada’s entire negotiating strategy, the patience, the refusals to fold, the alternatives being built have been based on the quiet confidence that July 1st is not a cliff. It’s simply a corner. and Canada already knew what is around it.
Apparently Trump, Greer, Hoekstra, Vance, et al, must have forgotten or have been unaware that Trump himself wrote and inserted Claus 34.7 and what it says.
Let’s go through exactly what article 34.7 says together because the legal text is Canada’s most powerful weapon and it has been hiding in plain sight. This is another glaring example of how screwed up the Americans are! CUSMA came into force on July 1st, 2020.
Article 34.7 requires that the three countries hold a joint review on the 6th anniversary, July 1st, 2026. At that review, each country must confirm in writing whether it wants to extend CUSMA for another 16 years until 2042. If all three agree, the deal isextended until 2042 and the next review is in 2032. Clean, simple.
If one of the 3 countries does not confirm extension, CUSMA does not die. Annual joint reviews begin. The deal continues in force. Every year the three countries review it. If they eventually agree to extend, they extend. If they never agree, the deal expires in 2036, a decade from now. And if any country wants to withdraw entirely, as Trump has threatened, not just decline extension but actually exit, it must give 6 months written notice under article 34.6.
That is a separate provision. Full withdrawal cannot happen on July 1st. The earliest it could take effect is January 1st, 2027. This is the architecture Trump built. And it means that no matter what happens on July 1st, no deal, no extension, no agreement, Canadian exports keep flowing under CUSMA. rules.
The tariff protections stay in place. The integrated supply chains keep running. The $600 billion in annual trade between Canada and the United States continues under the same legal framework. July 1st is not the end. It is the beginning of whatever comes next.
And Canada goes into that next phase with a deal that cannot be killed without 6 months notice and an economy that has spent 18 months building the alternatives that make even the worst case survivable.
Now, here is the part that makes this story extraordinary, and it is a fact that most coverage of CUSMA has completely ignored. A valid question here is where is our conventional Press and why do they continue to sew seeds of uncertainty when the facts are so readily available (if I’ve got them conventional media should have already explained all of this)!
34.7 was not a Canadian demand. It was not a Mexican demand. It was an American demand. Trump’s own first-term trade team added the sunset clause specifically to give Washington ongoing leverage over Canada (America has historically been exploitive of Canada and Mexico. The idea was simple. A trade eal that expires in 16 years gives the United States a regular opportunity to demand concessions as each renewal date approaches. Instead of a permanent agreement, you get a recurring negotiation. And in each negotiation, the larger economy has structural advantages.
But most significantly, 34.7 cuts both ways. Yes, it gives Washington leverage to demand changes at renewal, but it also means the deal cannot simply be terminated without a formal process.
Withdrawal requires six months notice. Non-renewal triggers annual reviews, not collapse. The floor under the trade relationship, the CUSMA protections that shield nearly 90% of Canadian exports from broad-based tariffs stays in place regardless of what Trump says at a press conference. Trump spent a year telling Americans that CUSMA would expire if Canada did not give him what he wanted.
He was describing a scenario that is legally impossible under the agreement his own administration wrote. Either he did not know what was in article 34.7 or he was counting on nobody else knowing. Canada knew. Canada’s trade lawyers knew. Canada’s negotiators knew.
And that knowledge is the quiet foundation under every public statement Prime Minister Carney has made about “patience and. alternatives and building for the long term. Canada was never staring at a cliff on July 1st. Canada was always looking at a corner and not a cliff.
With the 6 month time set out in 34.7 Prime Minister Carney has ample time to continue to offset the loss of American exports and the best part of all this is that for the first time in history we are getting market value for our exports by not subsidizing America with discount pricing on our resources.
So, if you’ve been following my blog you will already know that Prime Minister Carney, through what Pierre Poilievre falsely alleged that he was “grandstanding and traveling the world on the taxpayer’s dime“, has negotiated 20 trade deals on 5 different continents in just 1 year and has managed to restore 85% of our lost exports to America.
Common sense logic suggests that in half that time (6 months) going forward Prime Minister Carney will pick up at least another 15% of lost trade fully restoring us against Trump’s unlawful and unethical tariffs. I do not understand Republicans supporting the dysfunction that Trump has brought to global affairs.
Trump has repeatedly said that “America needs nothing from Canada” but the facts once again show that he’s conning. Uranium, water, oil, aluminum, lumber, potash are but a few realities that Trump, the Republicans and many Americans seem delusional about. America simply cannot feed its own nuclear reactors as it has almost no uranium. Now think about their nuclear fleet of submarines!
The Financial Times recently reported that “Canada has quietly shifted its trade strategy, pivoting from open defiance of American tariffs to what it is calling a fortress North America pitch. Instead of leading with Canada’s pitch. Instead of leading with Canada’s refusal to accept tariffs as permanent, Canada is now framing its value to the United States in terms Trump is more likely to respond to.
Secure supply chains, domestic manufacturing, energy reliability, and reduced dependence on China. This is not at all a capitulation. It is brilliant negotiating! It reframes the entire dispute. The underlying Canadian positions have not changed. Canada still wants tariff relief. Canada still considers the tariffs a violation of CUSMA.
Canada still refuses to accept them as permanent. But the language has shifted from confrontation to partnership, from elbows up to Fortress North America. Think about what fortress North America actually means in Trump’s language. It means Canada is not a trading partner that America is trying to get a better deal from. It meansCanada is a strategic partner that America needs to defend against China. Canadian critical minerals, Canadian aluminum, Canadian uranium, Canadian electricity and oil, Canadian aerospace and defense manufacturing, Canadian Arctic sovereignty, Canadian intelligence through five eyes.
All of it framed not as Canadian interests, but as American strategic assets that only work if Canada is strong. That is the argument Canada is making going into the G7 in France right now! Not give us a fair deal because we deserve it, but a strong Canada is an American strategic necessity. This framing does not ask Trump to be generous. It asks him to be strategic and strategy is a language Trump understands.
If July 1st comes and goes without a 16-year extension, the most likely outcome, according to every trade analyst who has looked at this, CUSMA enters annual review mode. The deal stays in force. Protections stay in place, bu uncertainty goes up. Every year becomes a new negotiating deadline.
But all Canadians should be aware that Canada has been preparing for exactly this scenario. the European trade deals, the Indo-Pacific Framework, the Defense Industrial Partnerships, the EU SAFE Instrument, the NATO Bank. Every alternative market and alternative alliance that Canada has been building is insurance against a prolonged annual review process that keeps CUSMA alive, but keeps uncertainty high.
The Bank of Canada’s base case is still a 16-year extension with limited changes. That is the outcome Canada is working toward. But if it does not happen on July 1st, the annual review scenario is not catastrophic. It is manageable. And Canada has been managing for this possibility since the day Prime Minister Carney took office.
For 18 months, Canadians have been told that July 1st is the deadline, the day CUSMA lives or dies, the moment of truth. And that framing has been wrong, deliberately is my bet or accidentally from the start. July 1st is a trigger date, not a death sentence. The deal does not expire. The protections do not vanish. The integrated North American economy does not shut down on the morning of July 2nd. What July 1st actually is, what it has always been, is the beginning of a new phase of negotiations and even the deaf, bumb and blind kid would know it!
Canada has never been in a better position going into a trade negotiation with the United States. Not because Canada is lucky, because Canada read the legal text, built the alternatives, held the line, and waited for the moment when the facts caught up with the narrative. That moment is right now and the most unique aspect of all this is that Canada has a world-class negotiator in control.
Now, if the Conservative Party of Canada and is Leader (“Maple MAGA”) will just stop lying and playing their distorted perspective of governance we will prevail in this. If they continue to lie then we Canadian people have got to step up and shut them down. Their conduct to date has been egregious, offensive and corrupt (politicians lying to us is corruption defined)!
The floor under Canada US trade stays in place regardless of what happens on July 1st. Prime Minister Carney knew this. His superior strategic and negotiating skills, his patience, his refusal to fold under pressure have positioned Canada to lead the world not just handle Donald Trump.
We Canadians are extremely fortunate to have had Prime Minister Carney accept the challenge of navigating these choppy waters. What disturbs me is the lack of integrity of the Conservative Party Members who are seen each week in Parliament supporting the intentional lies of Mr. Poilievre cheering and mocking the substantial material successes of our skilled Prime Minister.
