Volkswacht Bodensee - Canada not as reliant on US economy as some think: Carney

Canada and the United States are heading towards fractious negotiations on the future of a North American free trade agreement that President Donald Trump signed and praised in his first term, but now says is "irrelevant."

The Trump administration's key trade figures -- Commerce Secretary Howard Lutnick and US Trade Representative Jamieson Greer -- have been highly critical of Canada's posture ahead of talks set to accelerate over the coming weeks.

Appearing in Congress on Wednesday, Lutnick defended Washington's tough rhetoric and said "Canada's economy leans on the incredible 30 trillion dollar economy of America."

Carney told reporters on Thursday that "there is a misimpression, by some, of the degree to which we are reliant on the United States."

"Yes, it is our biggest trading partner by far. We are also their second-biggest trading partner. There is a symbiosis between the two," the prime minister said.

Canada's "destiny is first and foremost going to be determined by what we do here."

Trump has repeatedly said the US economy does not need anything Canada produces and told the World Economic Forum in January that "Canada lives because of the United States."

Greer's comments about Canada have been more muted.

He said this month that "pillars" of the United States-Mexico-Canada Agreement (USMCA) are functioning reasonably well and would likely be preserved, while stressing substantial parts of the deal need to be changed.

Both Greer and Lutnick on Wednesday voiced anger over an Ontario provincial government decision to ban the sale of US liquor and wine in retaliation for Trump's steel and auto tariffs, which are hurting the economy of Canada's largest province.

Lutnick told Congress the ban was "insulting and disrespectful to America."

Greer told US lawmakers "there may have to be an enforcement action to deal with this issue," an apparent reference to dispute mechanisms within the USMCA.

Asked about Ontario's US alcohol ban on Thursday, Carney said it was a provincial decision but noted US breaches of the USMCA are undeniable.

"The tariffs on steel, the tariffs on aluminum, the tariffs on automobiles...those are violations of our trade deal," Carney said.

C.Kreuzer--VB