Canada-U.S. bond strong and will survive, American ambassador tells Winnipeg audience By: Gabrielle Piché Posted: 6:50 PM CDT Tuesday, Jul. 29, 2025 Last Modified: 8:55 PM CDT Tuesday, Jul. 29, 2025 Updates

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Despite more than six months of economic threats that have sparked anger and strained cross-border relations, the United States ambassador to Canada believes the bond between his country and this one is solid.

Pete Hoekstra, who spoke to about 250 local business leaders Tuesday at a Winnipeg Chamber of Commerce luncheon, likened the current state of relations between the two nations to a cloth that’s been pulled and stretched, taking on a new shape.

“It will still be a shape that is a strong shape,” Hoekstra said. “What we need to do is make sure that we don’t do anything that starts to tear apart that fabric.”

The diplomat offered his perspective as the clock continues to tick down to Thursday’s Donald Trump-imposed deadline for a new U.S.-Canada trade deal. The president has promised a new round of punishing tariffs on Canadian imports if negotiators are unsuccessful.

And while tariffs will raise the price of imported goods in the U.S., almost inevitably leading to a rise in the inflation rate, Hoekstra said the Trump administration doesn’t see a cause-and-effect reaction on the horizon.

“We don’t see a direct link between the tariffs and inflation,” he said.

Acknowledging that economic matters between Canada and the United States will change after a deal is hammered out, he they will continue to be “strong partners.”

Hoekstra, who has been travelling across Canada for speaking engagement, wasn’t willing to predict the outcome of the current negotiations.

“A lot of action takes place in the last 70 to 96 hours,” he told the crowd at the Winnipeg Art Gallery.

He made note of recent U.S. trade deals struck with the European Union and Japan, both of which arrived at baseline 15 per cent tariffs on goods imported into the United States.

In a July 10 letter to Prime Minister Mark Carney, Trump threatened an additional 35 per cent tariff on a long list of Canadian goods. Steel and aluminum are already being hit with 50 per cent tariffs.

Hoekstra said the Trump administration is seeking prosperity for Americans and tariffs, a new tax bill and widespread government cuts are all part of the package.

“As we potentially pivot away from the United States in certain things, that’s because we believe in our ability to compete globally.”– Chamber president and CEO Loren Remillard

Chamber president and CEO Loren Remillard pointed to the United States consumer price index: in June, the country’s inflation rate was 2.7 per cent, a 0.3 per cent monthly increase. It followed another slight increase — 0.1 per cent — in May.

Hoekstra said that if inflation does, indeed, jump as a result of the president’s imposition of tariffs on international goods, the door is likely open for changes.

“(Trump is) focused on one thing, which is results,” he said. “If we get to a point somewhere down the road where it’s like, ‘I’m not getting to where I want to be,’ the president will adjust.

“If you want to know where Donald Trump is going, just listen to him.”

The luncheon crowd, which included elected officials from all levels of government, had to pass through a crowd of roughly 100 protesters who took the opportunity to highlight a variety of concerns with multiple U.S. foreign policies.

Ben Carr, Liberal MP for Winnipeg South Centre, declined to comment directly on Hoekstra’s note about inflation and tariffs.

Carney will ink a deal that is “done in a way that puts Canada on a path toward greater prosperity,” Carr said.

Winnipeg businesses will forge on if Canada’s trade deal ends up with a 15 per cent export tariff, Remillard said.

“It’s a resilient country with strong businesses,” he said. “As we potentially pivot away from the United States in certain things, that’s because we believe in our ability to compete globally.”

Canada didn’t start to pull on the threads of Hoekstra’s metaphorical cloth until the United States inflicted damage, Remillard said later.

Canada unleashed 25 per cent tariffs on a collective $59.8 billion worth of goods in retaliation to U.S.-imposed tariffs.

“We need something more than a deal,” Remillard said. “We need certainty that the deal will live past… 365 days, because businesses don’t make investments based on a quarter.

“We need stability.”

Evan Funk attended Tuesday’s event for clarity on the current business climate. He’s watched U.S. sales dip at Lynn & Liana Designs, a Manitoba-based cheeseboard creator.

Funk has noticed confusion online — customers seem to think Lynn & Liana products are being tariffed. In reality, the pieces are Canada-United States-Mexico Agreement (CUSMA) compliant and ship duty-free.

“That’s the biggest thing, is just confusion,” Funk said. “No one knows what’s going on.”

Both Carr and Remillard mentioned a need for Canada to diversify its export markets. A delegation of 19 European Union representatives visited Manitoba in April, expressing interest in greater trade.

Hoekstra said the U.S. will compete daily with the rest of the world for Canadian “opportunities.” In some markets, the U.S. and Canada are tied very closely, he added.

Before the event, a number of Manitoba business leaders sat for a roundtable discussion with Hoekstra. The ambassador also toured Boeing, an American aerospace manufacturer with a Winnipeg plant.

Hoekstra chaired the Michigan Republican party during the 2024 elections. He was a businessman in his early career, acting as vice-president of marketing for furniture maker Herman Miller.

— With files from The Canadian Press

gabrielle.piche@winnipegfreepress.com