US President Donald Trump has linked Canada’s recognition of Palestinian statehood to future trade relations between the two countries. Taking to Truth Social, Trump posted on Wednesday: “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!!!.”
Trump’s remark came after Canadian Prime Minister Mark Carney’s announcement that Canada would recognise the State of Palestine during the upcoming United Nations General Assembly session in September. Carney said the decision was driven by the worsening humanitarian crisis in Gaza and assurances from the Palestinian Authority of political reforms and upcoming elections excluding Hamas.
US tariffs on Canada
Tensions had already been simmering before this latest diplomatic twist. Earlier in July, Trump imposed a sweeping 35% tariff on Canadian goods, effective from August 1. He had previously ended all trade talks with Ottawa on June 28, citing frustration with Canada’s alleged failure to curb the flow of fentanyl into the United States.
“As you will recall, the United States imposed Tariffs on Canada to deal with our Nation’s Fentanyl crisis, which is caused, in part, by Canada’s failure to stop the drugs from pouring into our Country. Instead of working with the United States, Canada retaliated with its own Tariffs,” Trump said in an official letter.
He added that the tariffs were subject to change depending on Canada’s cooperation notably on drug enforcement but has now hinted at a hardened stance following the Palestine announcement.
Canada’s position on Palestine
Prime Minister Carney defended the decision to recognise Palestine, citing the deteriorating humanitarian situation in Gaza and the Israeli government’s role in restricting aid.
“Canada condemns the fact that the Israeli government has allowed a catastrophe to unfold in Gaza,” Carney said. “The reality on the ground, including starvation of people in Gaza, means the prospect of a Palestinian state is literally receding before our eyes.”
Carney said recognition was partly based on the Palestinian Authority’s pledge to reform its governance and exclude Hamas from elections scheduled for 2026.
Canada’s move comes amid a broader shift among Western nations. France recently announced its support for Palestinian statehood, and the UK has signalled it will follow suit in September unless Israel agrees to a ceasefire with Hamas.
However, the United States and Israel have forcefully rejected these announcements. A White House official claimed such recognitions “reward Hamas,” while the Israeli government said Canada’s stance undermined ceasefire efforts.