Trump threatens trade repercussions over Canada’s support for Palestinian statehood

July 31, 2025

RED FM News Desk

Washington, D.C. – U.S. President Donald Trump has issued a stark warning to Canada, saying its move to recognize a Palestinian state could jeopardize ongoing trade negotiations between the two countries.

In a post late Thursday on his social media platform Truth Social, Trump reacted strongly to Canada’s newly announced foreign policy stance.
“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. Oh, Canada!!!” he wrote.

The comment comes just days before an Aug. 1 deadline, by which the U.S. is expected to finalize new trade terms — or impose a 35 per cent tariff on Canadian goods not currently protected under the US-Mexico-Canada Agreement (CUSMA). The proposed tariffs could impact billions in cross-border trade.

Trump’s frustration follows an announcement by Prime Minister Mark Carney that Canada will formally recognize the State of Palestine during the 80th United Nations General Assembly in September 2025. The decision aligns with similar commitments made by the United Kingdom and France and reflects Ottawa’s long-standing support for a two-state solution.

Carney emphasized that Canada’s recognition would be conditional. The Palestinian Authority must implement key governance reforms, including holding free elections in 2026 without participation from Hamas, and agreeing to the full demilitarization of the proposed Palestinian state.

The U.S. and Canada are currently locked in difficult negotiations over existing American tariffs on Canadian steel, aluminum, automobiles, and copper. Trump’s statement now raises the possibility of further economic tension between the two allies.

The former president has been an unwavering supporter of Israel and Prime Minister Benjamin Netanyahu. His administration’s position diverges sharply from that of the Canadian government, which has cited the worsening humanitarian crisis in Gaza and the need for long-term peace in the region as driving factors behind its decision.