I have no doubt that Canada will cave to Trump on tariffs. The question is: when? “Shark Tank” star Kevin O’Leary expressed confidence that the ongoing trade tension between Canada and the U.S. would eventually lead to a resolution, and he even predicted when.
In an interview with Yahoo Finance, O’Leary said he believes that while the current rhetoric surrounding tariffs might appear grim, there is a strong economic incentive for both nations to come to the negotiating table and reduce the barriers that have caused friction in recent years.
O’Leary emphasized the importance of distinguishing between the “noise” of political rhetoric and the underlying “signal” that points toward economic cooperation. While current tensions have made it seem nearly impossible for the two nations to agree on trade policies, O’Leary argued that a combined economic effort between the U.S. and Canada could pose a significant challenge to China. “If you combine those economies… it would be much stronger against China if there were no tariffs between Canada and the United States,” he said.
The logic behind this argument lies in the historical and economic interdependence of the two countries. According to O’Leary, Canada’s economy has been deeply tied to the U.S. for over a century, with 75% of Canada’s output sold to the U.S. for more than 120 years. Furthermore, 17 U.S. states consider Canada their top trading partner, while 28 states rank Canada as their second-largest partner. “It would be economic suicide not to work this out,” O’Leary stated, underscoring the critical importance of a favorable trade agreement for both nations.
Related: Mr. Wonderful Destroys CNN With Masterful Defense of Trump's Tariffs
O’Leary predicted that Canada will wait until after Canada’s upcoming election, which is set to take place in about five weeks, before caving to Trump on tariffs. Until then, he sees no substantive progress taking place.
He speculated that the next leader of Canada will quickly prioritize resolving trade issues with the U.S. “That person will fly to Washington immediately and start negotiations, which I would call NAFTA III,” O’Leary remarked, referring to the possibility of a new trade deal similar to the USMCA (formerly NAFTA) that would replace the existing tariff policies.
The potential resolution is also tied to Canada’s political dynamics. O’Leary pointed out that the current Canadian leadership has been distracted by the trade dispute and other domestic issues. He specifically criticized Mark Carney, the interim prime minister, for attempting to use the Trump trade issue as a means of deflecting attention away from Canada’s internal economic struggles. O’Leary implied that Carney’s leadership has only exacerbated Canada’s difficulties. “Maybe he’ll get elected; maybe he won’t. Nobody knows right now,” he said, adding that no meaningful changes will occur until after the election.
Let's take the Canadian situation. If you combine those economies, I'm not saying buying the country, but if you combine the economies, we would be much stronger against China. If there were no tariffs between Canada and the United States, they had a common currency, and they… pic.twitter.com/edTed5X6pA
— Kevin O'Leary aka Mr. Wonderful (@kevinolearytv) April 5, 2025
In conclusion, O’Leary’s outlook suggests that, while the current trade situation between Canada and the U.S. is fraught with challenges, both countries stand to benefit immensely from removing tariffs and working together. The next Canadian leader, O’Leary believes, will be compelled to seek a deal with the U.S. once the political dust settles, which means that a breakthrough will likely occur soon after the election.
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