The United States abruptly terminated all trade negotiations with Canada.

In the latest news, Doug Ford, Governor of Ontario, Canada, said that he had communicated with Canadian Prime Minister Carney and decided to suspend advertising criticizing US tariffs in the United States in order to resume trade negotiations with the United States.

Earlier, US President Donald Trump was outraged, calling the ads "smearing US tariffs" and suspected of fraud, and announced the end of all trade negotiations with Canada. As soon as the news came out, the market was tense, and the Canadian dollar exchange rate fell, and the US dollar rose 0.34% against the Canadian dollar.

White House economic adviser Hassett also publicly stated that trade negotiations between the United States and Canada are not going well, President Trump is very disappointed in Canada, and the United States is increasingly dissatisfied with Canada's "lack of flexibility".

What is even more interesting is that before that, Canadian Prime Minister Carney made a tough speech, bluntly saying: The close economic relations between Canada and the United States have ended, and the relationship between the two countries will never return to what it used to be.

Canada-US trade talks have been suspended

On October 25, Doug Ford, Governor of Ontario, Canada, announced: After communicating with Canadian Prime Minister Carney, Ontario will suspend advertising criticizing US tariffs in the United States in order to resume trade negotiations with the United States.

Ford said the ad will not air again from next Monday. According to people familiar with the matter, Carney communicated with Ford twice on the evening of the 23rd and 24th, clearly wanting to stop broadcasting the advertisement.

U.S. President Trump posted on social media on the evening of the 23rd that Canada used a "false advertisement" to smear U.S. tariffs and was suspected of fraud, so the United States immediately terminated all trade negotiations with Canada.

The ad he mentioned cost about $75,000 and was produced by the Ontario government and placed in the U.S. border. Trump accused Canada of trying to influence U.S. Supreme Court and other court rulings through advertising, saying tariffs are critical to U.S. national security and the economy and cannot be discredited.

Trump attached a statement from the Ronald Reagan Foundation to the post. The statement states:

In response, the Reagan Foundation said it was "very disappointed" and was studying the possibility of taking legal action, and called on the public to watch the full original video of Reagan's speech to understand the real content.

After Trump announced the termination of negotiations, the market reacted quickly: the Canadian dollar fell sharply, and the dollar rose 0.34% against the Canadian dollar at one point. However, the Canadian dollar narrowed its decline to close at 1.39951 as the overall US dollar weakened due to rising expectations of a Fed rate cut on the same day.

To put it simply, a "anti-American tariff advertisement" in Canada caused big trouble, not only accused of "stealing Reagan's speech" and "distorting the original meaning", but also being identified as "fraud" by the United States, resulting in the direct suspension of trade negotiations. In order to ease the situation, Canada took the initiative to stop advertising, but relations between the two countries have become significantly tense.

The pressure is mounting in Canada

Earlier this month, Doug Ford, governor of Ontario, Canada, announced that the province would spend $5 million to advertise in the United States and criticize the US tariff policy.

"We will do everything we can to never stop opposing the US tariffs on Canada," he said. Only cooperation can achieve common prosperity. ”

Why is Ontario so angry? Because of the Trump administration's tariff policy, Canada's auto industry has been hit hard, and the main production base of the automotive industry is in Ontario.

Just this month, global auto giant Stellantis (which owns Chrysler, Peugeot, Citroen and other brands) announced that it will move a production line from Ontario to Illinois, USA. This is a blow to local jobs and the economy.

Canada raised tariffs on U.S. goods in August as a countermeasure because Canada and the Trump administration have not been able to negotiate.

The United States did not show weakness, and Trump previously signed an order to impose tariffs of up to 35% on some Canadian goods, effective from August 1.

However, this tax increase does not apply to products covered by the United States-Canada-Mexico Agreement (USMCA), such as most goods exported through the agreement channels still enjoy preferential treatment.

Some analysts pointed out that many countries have recently reached new trade agreements with the United States and obtained tariff exemptions or preferential treatment. In contrast, Canada has not yet reached a deal and is facing rising diplomatic and economic pressures. This tariff dispute is not only a matter of money, but also related to the industrial layout and future cooperation between the two countries.

Canada begins to "find new friends"

The Associated Press reported that Canada is the largest export market in 36 U.S. states, with about $3.6 billion in goods and services flowing between the two countries every day, and the relationship is very close.

But since August this year, the situation has changed: many Canadian goods are exported to the United States with tariffs of up to 35%. What makes Canadians even more uneasy is that Trump has repeatedly publicly said that he wants to "annex Canada" and even joked that he wants to turn Canada into the "51st state" of the United States.

In this context, more and more Canadians are beginning to worry that it is too risky to rely too much on the United States for business. The call for change is getting louder and louder.

In order to reduce its dependence on the United States, Canada has recently actively expanded its cooperation with other countries:

Canadian Prime Minister Carney also specifically mentioned: "While consolidating our relationship with old allies, we are re-engaging with India and China to promote more cooperation." ”

U.S. tariff policies not only affect exports, but also cool foreign investment in Canada.

The Canadian think tank Howey Institute released a report last month stating that Canada's economy shrank by 0.4% in the second quarter of this year due to declining exports and reduced investment. Although it has not yet entered a recession, it is clearly feeling the pressure. The job market is also not optimistic: the unemployment rate rose to 7.1% in August, the highest level in more than four years.

Carney reminded the public: the world is becoming more and more competitive, and if you don't act now, the pressure will only increase in the future. But he also stressed that economic transformation cannot be completed overnight, it will take time, and everyone will need to bear some short-term sacrifices together.

Jingtai View: This is Canada's most radical foreign trade transformation since World War II, and "de-Americanization" is not a slogan, but a necessity for survival. Proposed layout of the "post-North American trade era":

1. Short-term: Avoiding export-dependent Canadian assets to the United States Canadian aluminum, steel, automobiles, and timber industries bear the brunt; Suggestion: Temporarily avoid traditional Canadian manufacturing stocks; Keep an eye on forex trading opportunities arising from fluctuations in the Canadian dollar exchange rate.

2. Medium-term: Pay attention to the beneficiary stocks related to Canada's "new trading partner", Canada is accelerating its "looking east": China: resumption of cooperation in resources, agricultural products, and science and technology; India: Infrastructure, energy, digital services; Southeast Asia (Indonesia): Free Trade Dividend.

Positive: Chinese-funded enterprises with resource trade with Canada; Canadian mining and energy companies in the Indian market.