‘Hard for us to make a trade deal’: Trump on Canada recognizing a Palestinian state

On the eve of his latest tariff deadline, U.S. President Donald Trump says Canada’s decision to recognize a Palestinian state will hurt the urgent trade talks underway between the two countries.

“Wow! Canada has just announced that it is backing statehood for Palestine. That will make it very hard for us to make a Trade Deal with them,” he wrote in a post to Truth Social published overnight Thursday.

Canada and the United States have been negotiating a deal since shortly after Trump took office this year, when the U.S. president imposed a slate of sweeping tariffs on imported goods that rapidly developed into a global trade war.

In the months since, governments in both countries have imposed an ever-shifting array of tariffs and other trade restrictions on one another. Most recently, Trump has threatened new tariffs of 35 per cent unless Canada reaches a trade deal by Friday.

Throughout the trade war, Trump has repeatedly adjusted the timing of tariffs on Canada and other countries, including substantial delays, but earlier this week, U.S. Commerce Secretary Howard Lutnick said that there would be “no extensions, no more grace periods” on the deadline, this time around.

"Aug. 1, the tariffs are set. They’ll go into place. Customs will start collecting the money, and off we go,” he said.

Two-state solution

Trump’s social media post comes hours after Prime Minister Mark Carney announced Canada would formally acknowledge an independent state of Palestine.

“Canada has long been committed to a two-state solution — an independent, viable, and sovereign Palestinian state living side by side with the State of Israel in peace and security,” Carney wrote in a statement Wednesday.

“For decades, it was hoped that this outcome would be achieved as part of a peace process built around a negotiated settlement between the Israeli government and the Palestinian Authority. Regrettably, this approach is no longer tenable.”

Palestinian statehood has become the latest flashpoint in the debate among western allies over the war between Israel and Hamas, the designated terror organization in control of the war-torn Gaza Strip, and which along with other militant groups perpetrated widespread attacks on southern Israel on Oct. 7, 2023, taking hundreds of hostages and killing approximately 1,200 people, most of whom were civilians.

In the nearly two-year conflict that has unfolded since, including frequent bombardment of Gaza by the Israeli military, widespread displacement of Palestinian civilians and a crisis of insufficient food and supplies that has sharpened in recent weeks, more than 60,000 people have died within the enclave, according to Gaza’s health ministry.

In his Wednesday statement, Carney cited the humanitarian crisis, and what he called the Israeli government’s “ongoing failure” to prevent it, among the the factors impeding a two-state solution, alongside the “pervasive threat of Hamas terrorism to Israel and its people,” increasing settler violence against Palestinians and recent calls among some members of Israel’s parliament for the annexation of the West Bank.

“The deepening suffering of civilians leaves no room for delay in co-ordinated international action to support peace, security, and the dignity of all human life,” Carney wrote.

“Preserving a two-state solution means standing with all people who choose peace over violence or terrorism, and honouring their innate desire for the peaceful co-existence of Israeli and Palestinian states as the only roadmap for a secure and prosperous future.”

International debate

In a statement Wednesday, Israel’s Embassy to Canada decried the announcement, arguing that recognition “in the absence of accountable government, functioning institutions, or benevolent leadership, rewards and legitimizes the monstrous barbarity of Hamas on October 7, 2023.”

“Let us be clear: Israel will not bow to the distorted campaign of international pressure against it,” Ambassador Iddo Moed said in the release.

Recognition by Canada, Carney has said, will be granted on the condition that the Palestinian Authority (PA) hold a general election next year that does not include Hamas, and that the Palestinian state be “demilitarized.”

Carney revealed plans to announce Canada’s recognition in a “lengthy and robust” call with PA President Mahmoud Abbas earlier in the day.

“It relies upon the representations that have been made by the Palestinian Authority,” Carney told reporters.

“We’ll be working with the Palestinian Authority, and very importantly, not just us, but a series of our allies and regional powers.”

The PA, a political organization separate from Hamas, was overthrown when the terror group seized power over the Gaza Strip in 2007. Canada recently announced $10 million in aid funding for the authority to support its efforts to govern.

In a statement overnight Thursday, the PA’s Ministry of Foreign Affairs and Expatriates welcomed the announcement.

“This courageous and principled decision marks a significant step towards justice, peace, and the long-overdue realization of the Palestinian people’s inalienable right to self-determination,” reads a post on X.

“The Ministry calls upon all countries that have yet to recognize the State of Palestine to do so with courage and resolve.”

Canada is the latest western ally in recent days to announce intentions to recognize Palestinian statehood, joining France and the United Kingdom, with the latter warning that recognition would come if Israel did not make sufficient progress in pursuing a ceasefire, among other demands.

The United States, meanwhile, announced on Thursday sanctions on members of the PA, accusing them of obstructing peace efforts in the region.

And earlier this year, U.S. Ambassador to Israel Mike Huckabee spoke out against recognition, describing a United Nations initiative to revive work toward a two-state solution as “incredibly inappropriate when Israel is in the midst of a war.”

“If France is really so determined to see a Palestinian state, I’ve got a suggestion for them — carve out a piece of the French Riviera and create a Palestinian state,” Huckabee said. “They are welcome to do that.”

Asked Wednesday whether he consulted with the United States on his decision, Carney described it as an “essential partner” in Middle East peace efforts, but that Canada makes its own “independent foreign-policy positions.”

Canadian parties split

The prime minister’s announcement has drawn mixed reviews among Canada’s opposition parties.

“Recognizing a Palestinian state in the aftermath of the October 7 terrorist atrocities sends the wrong message to the world,” reads a statement from the Conservative Party of Canada.

“The suffering of Palestinians is real, and their lives are precious — but Hamas is to blame for that suffering, and peace cannot come through appeasement.”

The federal NDP, meanwhile, described the decision as a “welcome step forward,” but urged for formal recognition to come immediately, rather than at the UN General Assembly later this year.

“It should not have taken the Liberals this long to make this decision — and it should not take until September to implement it,” a statement from the party reads. “Under international law, the State of Palestine already exists, and the majority of the world — 148 countries — recognize it.”

The NDP have also called on the federal government to impose an arms embargo on Israel, suspend Canada’s free trade agreement and lay sanctions on officials including Israeli Prime Minister Benjamin Netanyahu.

With files from Tammy Ibrahimpour, The Associated Press and AFP