Trump Announces 'Termination' of Trade Talks with Canada, Raising Economic Tensions

President Donald Trump announced he's immediately ending all trade talks with Canada, accusing Ottawa of using distorted quotes from former President Ronald Reagan in an advertising campaign against tariffs. The sudden move comes just two weeks after Canadian Prime Minister Mark Carney visited the White House trying to ease American tariff threats.

Trump posted on his Truth Social platform that "based on their terrible behavior, all trade negotiations with Canada are terminated." He claimed the Ronald Reagan Foundation said Canada used a "fraudulent and false" advertisement showing Reagan speaking negatively about tariffs.

This marks a sharp turn in relations between the North American neighbors. Carney's recent White House visit was meant to smooth over tensions and prevent new tariffs that could hurt both economies. Instead, the dispute over the Reagan ad has apparently derailed diplomatic progress.

The timing puts significant pressure on Canada's government, which has been working to maintain the trade relationship that's crucial for both countries. Canada and the US share one of the world's largest trading relationships, with billions of dollars in goods crossing the border daily.

For markets, this creates immediate uncertainty. Canadian businesses that depend on US trade now face potential disruption, while American companies that rely on Canadian resources and markets could also feel the impact. The sudden nature of Trump's announcement gives little time for either side to prepare contingency plans.

The Reagan Foundation's involvement adds another layer to the dispute. Using a former president's image and words in political advertising often requires careful handling, and any misrepresentation can quickly become a diplomatic issue.

Both countries now face the challenge of whether this is a temporary dispute that can be resolved, or if it signals a longer period of strained trade relations. The economic stakes are high enough that pressure from business groups on both sides could push for a quick resolution.