About 75% of Canada's exports go to a single buyer, and Derek Decloet says officials in Ottawa have stopped treating that as a settled fact of geography.
The usual framing of the trade war is a negotiation that ends when the tariffs come off. Decloet's reporting is that the Canadian government has stopped assuming there is an old order to go back to, and is building relationships in Europe on a timeline longer than one US administration.
"You can't count on a snapback to the old order when Donald Trump goes."
Decloet is the executive editor for Canada at Bloomberg News, running the coverage of the trade negotiations, and he calls this "the biggest economic and political story probably of my lifetime."
The full episode is covered here so you can skip it. 18 minutes of audio, 11 minutes of reading.
Here are the 9 insights that matter.
👤 Guest: Derek Decloet, Executive Editor for Canada at Bloomberg News
🎙️ Host: David Gura, Bloomberg News anchor and host of The Big Take
📰 Published: 14 September 2026 on the Big Take podcast feed (Bloomberg News)
🟣 Apple Podcasts | 🔗 Episode page | ⏱️ 18 min | ✅ Time saved: 7 min
Key Takeaways
Canada's turn toward Europe is the biggest economic and political story of Decloet's lifetime
Since the 1980s the whole trajectory had run the other way, toward the United States
Europe is receptive because both sides have been on the receiving end of the same criticism
Decloet's read of Carney's Davos message: middle powers work together or get bullied
What Canada has that Europe lacks is raw material, and distance was the only thing in the way
Washington asked for a say over the trade deals Canada signs with anyone else
The stated concern is Chinese goods reaching the US through Canada
Tariffs are now as high as they have been under this administration, and both sides may be quietly de-escalating
Decloet says a deal is possible but rebuilt trust will take longer
The US goal on autos is that virtually every assembly plant in Canada eventually closes
Canadians are starting to prepare for the USMCA to lapse rather than be renewed
The expiry date is 2036, and the alternative is a patchwork of sector-by-sector rules
Having 75% of exports go to one buyer is the risk Ottawa now wants to price, whoever wins in 2028
1. Why Carney Can Do This
David Gura opened on Canada's prime minister taking his pitch to Europe, and on the line Carney has used more than once — that Canada is the most European of non-European nations. Decloet's answer was about the man rather than the policy.
"What he's trying to do is pull Canada much closer to Europe in a bunch of different ways," he said. "Carney is something of a Europhile and I think, you know, sees natural alliances."
The practical asset is a contact book built in two central banks. "He has a Rolodex." He was governor of the Bank of England, and before that governor of the Bank of Canada during the financial crisis, when he was involved in the coordination among central banks and regulators.
"So I do think he's a unique person. There are not many people in Canada who could try to pull this off." What makes him unusual, Decloet said, is having both the connections and that level of credibility.
2. A Once-in-a-Lifetime Shift
Asked how significant the moment is, Decloet did not hedge.
"I've been describing it to people as the biggest economic and political story probably of my lifetime."
The reason is the direction of travel it reverses. Since the 1980s, and arguably before, he said, the entire economic trajectory of Canada has been pulling closer and closer to the United States.
"And so I think it is a real shift in mindset for the whole country."
3. Why Europe Is Receptive
Gura noted that the debate about whether Canada could actually join the European Union has been running in public for months, and that Bloomberg's reporting has EU officials seeing the potential for a closer relationship with Canada than the one they have with the UK.
"They've been quite receptive, and I think there are some logical reasons for that."
The first is shared experience of the same criticism. "Both Europe and Canada have been at the other end of verbal attacks from members of the Trump administration on all sorts of issues, including defense." Decloet allowed that some of it, particularly on the pace of defense spending, was justified.
The second is institutional history: a long record of joint NATO membership, and a common feeling of being under attack.
The third is Carney's own framing, which Decloet summarized as a warning to countries of Canada's size: "Middle powers, they have to work together in order to avoid being bullied. He didn't use the word bullied, but that was the message." That was aimed in part at Europe, he said, because Europe is where the middle powers are.
4. What Each Side Gets
The starting point is that a trade agreement already exists, so the new material is elsewhere.
"There's been a free trade agreement in place between the European Union and Canada for roughly 10 years, and it's been sort of implemented slowly," Decloet said. "But you don't have a ton of trade barriers. There's largely tariff-free exchange going on."
"Obviously, defense is clearly one." Ukraine is the binding issue: "People of Ukrainian descent are one of the largest groups in Canada," and the country has taken in refugees since the war began. Space exploration and supply chains came next on his list.
The asymmetry Canada can trade on is physical. "One thing that Canada can clearly do for Europe is natural resources." "We have a great surplus of oil, natural gas, potash, certain food staples." Europe, he said, has a surplus of very few of them.
The barrier has never been politics: "The only reason why that supply chain relationship hasn't been closer up till now is the physical distance."
Underneath the commercial case is a security one that is new to the Canadian public. "And Canada needs allies that, you know, would come to its defense, you know, in a variety of ways." "And that is something that the Canadian public never really had to contemplate." The question being asked now, he said, is where else Canada would find allies if a US administration moved against it in a more serious way than tariffs.
5. The Risk of Annoying the US
Gura asked whether courting Europe this openly carries a cost in Washington. Decloet said the government knows it does.
"And one of the things that the U.S. clearly wanted in those trade negotiations was some say about other trade deals that Canada is going to do or might want to do in the future."
He was even-handed about the motive. "Now, a lot of that is about China and making sure that Canada doesn't become some sort of backdoor for Chinese goods to get into the U.S." He called that a real and legitimate consideration for the United States.
The collision is over the same commodities. "But this administration in Washington has made it pretty clear that, you know, they like Canada's resources. They want more oil and they want more access to critical minerals."
So a deal sending those resources east is the part that bites: "I think that is something that the U.S. will probably not enjoy." Whether Washington would act on it, he said, would depend on the shape of the alliance.
6. Order Rebuilt Out of Europe
Gura put Carney's larger claim to him — the prime minister's view, as Gura read it, that "it's my strong personal view that the international order will be rebuilt, but it will be rebuilt out of Europe" — and asked what it means.
Decloet treated it as a genuine puzzle, since Europe is not as economically dynamic as the United States right now, or as parts of the Asia Pacific.
What Europe has instead, in his reading, is institutional durability: "But what it does have is, you know, Europe is built around powers that now have strong democratic, you know, traditions and certain values about common security, for example, pushing back against Russia."
The rest of the answer was about what has been built since 1945 — a set of institutions designed to carry those commitments from one generation to the next, which he said is what makes Europe a beacon in the democratic world despite its flaws.
He was careful not to write the United States out of it. "The U.S. has always been a beacon." The difference now, he said, is that there are bigger questions about the direction it is going.
7. Where the Trade War Stands
After the break, Gura asked for the state of play in the tariff fight.
"So where we stand now is the tariffs between the two countries are as high as they have been in this administration." "A few days ago, the Trump administration announced it would ban certain categories of Canadian goods."
The reporting cuts the other way on intent: "And it's our belief now, based on things the prime minister has said, based on things we've heard out of Washington recently, that perhaps both sides are looking to quietly de-escalate this."
What will not be repaired on the same timetable is public opinion. Canadians feel trust has been broken, he said, and every poll shows it. "And there may, in fact, be a deal. But the rebuilding of trust, I think, will take longer."
On what each side is actually fighting about:
"The biggest pain points for Canada have to do with the auto industry" — specifically, he said, the president's and the Commerce Secretary's stated intention that virtually all Canadian auto assembly plants eventually shut and production move to the US
"Steel is a pain point." So is wood: "The lumber industry is actually really important in parts of Canada." The tariffs are costing jobs, and "They're causing mills to shut down in places where sometimes that's the only employer."
"From the U.S. side, the retaliation is at the top." "You know, alcohol, wine and spirits are not actually that big a factor in bilateral trade, but it's so very visible." Canada pulled the bottles off the shelves and everyone has the video. "Bourbon makers in Kentucky are mad." "And it's just a very in-your-face thing. And the U.S. wants that over with."
"One of them is dairy, you know, milk and cheese." The US view, he said, is that Canada read the agreement's rules so as to make access as hard as possible for American milk producers. "And they're really annoyed by that."
8. USMCA May Simply Expire
Gura raised the decision not to extend the agreement Canadians call CUSMA, and what the refusal to rubber-stamp it signaled.
"I think that that was not a surprise for those who were following Donald Trump closely really since the 2024 campaign." "Although it is his deal and he negotiated it in the first term, he was pretty clear even back before he won the election that he didn't love it" and wanted it renegotiated.
The new expectation in Canada is not a worse deal but no deal: "I think people here are starting to prepare for something that they were not really prepared for a year ago, which is the idea that this thing will just expire at some point" — either because the US withdraws or because 2036 arrives without an extension.
"And you wind up with this very patchwork trade relationship between Canada and the U.S. and Mexico where you have tariffs in some sectors and no tariffs in another and different rules that are negotiated on an ad hoc basis."
"People here are starting to mentally get their minds that that might be the outcome."
9. Life After the Trump Years
Gura asked whether Carney is insulating Canada for the next two years or thinking past them.
"I do think he's thinking beyond that." The view inside the prime minister's office, he said, is stated plainly: "You can't count on a snapback to the old order when Donald Trump goes." There are reasons to expect some form of trade protectionism to persist.
The structural argument is separate from the politics: "I think there's also an argument to be made that it is unhealthy for a country like Canada, a rich country, but a very resource-dependent country, to have 75% of its exports go to a single buyer."
"And that you have to mitigate that risk no matter what you think is going to happen in 2028, you know, in the U.S. election."
Bonus Insights
Asked whether there is appetite for more talks in the window before the import bans take effect, Decloet said there is, and the pressure is coming from inside the United States: "I think there is appetite." He pointed to border-state politics — "There's a Senate seat in play in Michigan" — and said those are places where people know more Canadians and the economic ties are stronger. On the Canadian side, he was blunt about the limits of the alternative: "You can say you're going to diversify, but there are some industries for which that's extremely difficult or maybe even impossible."
Gura suggested President Trump may be doing Canada a favor by forcing it to diversify. Decloet said plenty of people hold that view — "that we did become complacent because of this long path of very easy and growing trade with the world's largest economy" — and offered a second framing: "It was a wake-up call for Canada about that level of complacency about its own economy, that you can't just ride the tailwind of the U.S." He also credited governments before Carney with signing agreements with the EU and with partners in Asia such as South Korea.
The second half of the reorientation is internal, and it is a geography problem: "Canada is a big country, and one of the reasons it trades north-south is that sometimes it's expensive to trade east-west." His example was construction: "It's hard to, if you're building a project in British Columbia, to buy steel from Ontario." That is a long way to ship it, and fixing it, he said, is the other way to insulate the country over the longer run.
Decloet's bottom line is that Canada is not waiting out an administration. Ottawa is treating its dependence on one buyer as a risk to be reduced permanently, in Europe and inside its own borders, on the assumption that the trade relationship it had is not coming back in the form it took.
Products, Companies & Tools Mentioned
USMCA, which Canadians call CUSMA (The North American agreement now up for renegotiation rather than extension, with a 2036 expiry date Canadians are starting to plan around; its dairy rules are one of the US side's stated grievances)
The Canada-EU free trade agreement (In place for roughly 10 years and implemented slowly, which is why Decloet says the new Europe relationship is about defense, security and supply chains rather than tariffs)
NATO (The long history of joint membership Decloet names as one reason Europe has been receptive to Canada)
The European Parliament (Where Carney was traveling to speak, in Strasbourg, at the time of the conversation)
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