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Carney Faces Crucial Test after Walking Away from Trump’s Deal

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The United States and Canada have entered into uncharted territory.

The longtime allies and economic partners, who have enjoyed free trade for decades, are now in an escalating trade war with no clear off ramp.

And for Prime Minister Mark Carney, the late night decision to suspend talks with President Donald Trump and to retaliate instead of agreeing to a deal that seemed in reach will be a significant political test.

He is one of the first world leaders to walk away from the negotiating table with the White House – and the outcome will be closely watched.

Both sides have blamed last-minute changes for torpedoing the tentative deal, with Carney saying the US “asked too much” and “offered too little”.

Carney’s decision will challenge the appetite among Canadians to accept some economic pain as Ottawa pushes for more US concessions.

After rejecting Trump’s high pressure tactics, and in choosing to hit back against the latest duties, Carney will need to convince Canadians that the economic pain is worth the cost of standing up to the Trump administration in search of a better agreement in the long run.

In remarks on Saturday, he said “we take this step confident this is in the best interest of Canada” and accused the US of a “power play” by seeking eleventh-hour changes.

Asked by a reporter whether the US and Canada were locked in a trade war, he replied: “You’re at war when you’re attacked – we got attacked.”

Switching to French, he said the spiralling trade dispute “wasn’t our choice”, adding: “Canada is strong, Canada is ready, Canada is united.”

There is no doubt this will cause pain on both sides of the border, with business facing more pressure from US duties and Canadian counter-tariffs.

Canada sends about 70% of its exports to the US, and the country is the top trading partner for a number of US states, with Michigan, Kentucky, Indiana and Ohio among the most exposed.

Carney came to power with a call for “elbows up” – an ice-hockey term for an aggressive approach – vowing to fight for Canada in the face of a Trump administration keen to exert economic pressure for its America First agenda.

Many Canadians have told pollsters that they are willing to fight.

A recent survey by Abacus Data suggested that around 36% of Canadians would support retaliating to US tariffs, while a Leger poll indicated that 56% of Canadians want the federal government to take a hard line and make no more concessions.

Canadians frustrated with the US tariffs have already chosen to avoid travelling there. The boycott has meant a loss of about C$3.3bn ($2.35bn; £1.75bn) in travel revenue for the US last year.

A decision by most provinces to remove US alcohol from store shelves has hammered that sector.

Based on US government trade data, US wine exports to Canada fell 78% year over year, a $357m loss in export value. The US distillers association reported similar numbers – saying provincial bans have caused exports of American spirits to drop by more than 70%.

The ban quickly became a point of frustration for the Trump administration.

Canada’s prime minister will also need to convince the provinces who have been less affected by the US trade dispute so far that walking away is a risk worth taking.

He briefed them on Saturday on the current state of affairs, and for now, they are showing a united front.

British Columbia Premier David Eby said he was committed to the “national project we are on”, while Ontario Premier Doug Ford said “we didn’t start this fight, but I can assure you, we’re going to win this fight.”

It’s still unclear exactly how the talks fell apart in the final hours, but by all accounts it came down to the wire.

Carney said that late US proposed terms “were unfair, uneconomic, and called into question the reliability of any deal”.

He added on Saturday those terms included demands on the automobile sector and “unacceptable” restrictions on trade deals with other countries.

In one biting line, he said of the Trump administration: “We recognise sometimes its signature is written in pencil.”

US trade representative Jamieson Greer, meanwhile, pointed to “new demands and walk backs of other commitments by Canada”.

In a statement on Friday, the Distilled Spirits Council of the United States suggested “Canadian provinces’ continued refusal to return US spirits products to store shelves has led to this outcome”.

There were also reports by Canadian media that US Commerce Secretary Howard Lutnick was unhappy with the deal.

And as details on an interim trade agreement with the US trickled out over last week, some provincial leaders, industry groups and political opponents raised concerns that the prime minister had not delivered on the fight he promised – though Carney denied that swayed his thinking.

Ford, usually one of the most vocal Canadian politicians on US tariffs, had been silent on the tentative deal all week. But in a letter sent to Carney, he raised concerns that an agreement under pressure would “embolden the United States to seek concession after concession”.

The province, which has a large manufacturing and vehicle sector, has been among the hardest hit regions in this trade dispute.

Conservative opposition leader Pierre Poilievre said that any agreement that included “one-sided” tariffs on Canadian industry would be “a bad deal”.

On Saturday, he backed Carney’s decision to walk away for now, saying: “Canada cannot accept one-sided tariffs that will de-industrialise our country.”

The collapse of this agreement calls into question the future of such talks, including an ongoing review of the US-Mexico-Canada free trade pact.

Now Carney – and Canada – must wait to see how Trump responds.

Foreign News

Trescothick Eager to Keep England Job Despite Hussey Approach after Pakistan Win

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Marcus Trescothick has insisted he wants to continue working with England’s Test team even though Mike Hussey has revealed an approach by incoming head coach Stephen Fleming to effectively replace him.

Trescothick has been a member of England’s backroom staff since 2021 and is currently leading the Test side on an interim basis ahead of Fleming’s arrival.

Former opening batsman Trescothick and returning captain Joe Root oversaw an innings and 103-run thrashing of Pakistan in the first Test at Headingley on Friday as the hosts went 1-0 up in a three-match series.

Former Australia international Hussey has said he is considering an offer to work as England’s Test batting coach, effectively Trescothick’s role, after being approached by Fleming, his former boss at Chennai Super Kings.

“I’d love to carry on, of course,” said Trescothick.

The 50-year-old, a member of England’s 2005 Ashes-winning team, added: “I’ve a huge amount of respect for Stephen and what he’s done in the game, he was a fantastic captain and leader, and has done a brilliant job doing what he’s done as a coach.

“It’s really not in my job (description) or position to judge that. We’ll wait until we get the tap on the shoulder.”

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Iran’s President Says US Memorandum Best Path Out of Stalled War

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Iranian President Masoud Pezeshkian defended a recent memorandum of understanding as the best way for the country to move beyond what he described as a situation of “neither war nor peace.

In a speech published by state-run IRNA early on Sunday, he said members of Iran’s Supreme National Security Council believed the memorandum represented the best possible agreement based on what he described as dignity, wisdom and the national interest.

“There is not a single provision in this agreement that amounts to capitulation,” Pezeshkian said. “The supreme leader sets the policies, and we will follow that path.

The deal known as the Memorandum of Understanding that US President Donald Trump signed in June set an ambitious 60-day deadline for ending the war with Iran and reaching an accord on its nuclear program. That period ended last week, but the two sides remain far apart, with no signs of compromise on the crucial issue of reopening the Strait of Hormuz, vital to global shipping.

Pezeshkian also linked the agreement to Iran’s economic prospects, saying the country could not attract investment in this stalled phase.

“Capital and money are extremely sensitive to risk,” he said. “We have to remove this risk from the country.”

Nearly six months into the war with the United States and Israel, the Iranian economy is suffering under sanctions and a naval blockade.

Pezeshkian acknowledged that his country’s citizens face “many problems,” after the United States launched a new wave of sanctions seeking to further isolate its economy.

“I understand we have many problems in society right now. We are trying to prevent these as much as we can,” Pezeshkian said.

Pezeshkian said that, thanks to Trump, Iran was “in a full-scale economic, military and security war.”

“He says he is imposing the most crushing and terrifying sanctions on Iran,” Pezeshkian said.

Meanwhile, the hard-line new leader of Iran’s Supreme National Security Council warned Tehran’s neighbors against joining the new US effort to hurt Iran’s economy.

“If (Trump) wants to do something, we will retaliate in a seismic manner,” Mohsen Rezaei said in an interview with the state broadcaster that aired Saturday.

Rezaei was named this month as part of senior appointments widely seen as hardening Tehran’s political and military stance. His interview with IRIB is his most extensive public statement since then.

Rezaei said Iran would target oil-shipping routes out of the Persian Gulf — alternatives to the Strait of Hormuz — if neighbors join what he described as the economic war against Iran.

Trump in the past week has vowed to increase Iran’s pain by imposing an “unprecedented” level of economic warfare and isolation. Iran has lived under sanctions for years.

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Iran FM, Pakistan Military Chief Discuss Regional Devts as US Eyes New Tehran Sanctions

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Iran’s Foreign Minister Abbas Araghchi and Pakistan’s defense forces chief, Field Marshal Asim Munir, discussed regional developments and efforts to advance diplomatic solutions, Iranian state media reported on Sunday, as Washington plans to announce new sanctions targeting Tehran.

After nearly six months of war since the US and Israel launched airstrikes against Iran on February 28, the sides are not firing at each other but also showing no sign of pursuing peace talks.

Oil shipments are at a virtual standstill in the Strait of Hormuz, with Tehran threatening to strike any unauthorized oil tankers that try to transit the vital waterway, and Iran’s economy is already under immense pressure from sanctions.

Pakistan, which helped broker an interim US-Iran peace deal in June, has been engaged with the leaderships of the US and Iran in efforts to broker peace between the two countries since their conflict broke out in February this year.

“During the telephone conversation, both sides reviewed the latest regional developments and discussed various dimensions of the current situation,” Iran’s state-run IRNA new agency reported, following telephonic conversation between FM Araghchi and Field Marshal Munir.

“The two sides also exchanged views on diplomatic trends, ongoing efforts to advance political and diplomatic solutions, and ways to enhance bilateral consultations and cooperation.”

This is the second time Araghchi has spoken to Munir, who emerged as a key figure in US-Iran negotiations, about regional developments in less than a week.

The development comes after US Treasury Secretary Scott Bessent threatened “the toughest sanctions in history” on Iran. He has also urged cooperation with Washington by China, which buys more than 80 percent of Iran’s shipped oil, according to 2025 data from ‌analytics firm Kpler. ‌Beijing has urged diplomacy.

Iran’s Foreign Ministry spokesperson, Esmaeil Baghaei, said on Saturday the imminent US announcement of ‌new ⁠economic sanctions was an “assertion ⁠of extraterritorial sovereignty over every independent member state of the United Nations.”

The US-Iran war has driven oil prices higher and created inflationary pressures, especially for countries like Pakistan who heavily depend on the Middle East for their fuel needs. Iran has frequently attacked its neighbors in its Gulf region since the war began, firing missiles and carrying out drone attacks the UAE, Saudi Arabia, Kuwait, Bahrain, Qatar and other countries.

Islamabad has repeatedly called for diplomacy to resolve the conflict and said last week it was making “all-out efforts” through direct and indirect channels to bring Washington and Tehran back to the negotiating table.

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