Trump warns Canada on trade over its Palestine stance

Washington: Canada announced it would recognise Palestine as a sovereign state at an upcoming meeting of the United Nations, eliciting a trade warning from US President Donald Trump on the eve of a deadline to reach a tariff agreement.

Canadian Prime Minister Mark Carney said that while Canada had long supported a two-state solution, it was regrettably no longer tenable via a negotiated settlement between Israel and the Palestinian Authority.

“International co-operation is essential to securing lasting peace and stability in the Middle East, and Canada will do its best to help lead that effort,” Carney said.

“The deepening suffering of civilians leaves no room for delay in co-ordinated international action to support peace, security and the dignity of human life.

“Preserving a two-state solution means standing with all people who choose peace over violence or terrorism. And it means honouring their innate desire for peaceful co-existence.”

Noting Canada’s stance on statehood for Palestine, Trump posted on his Truth Social platform, “Wow! … That will make it very hard for us to make a Trade Deal with them”.

Trump is set to impose a 35 per cent tariff on all Canadian goods not covered by the US-Mexico-Canada trade agreement if the two countries do not reach an agreement by August 1.

Carney said Canada’s decision was predicated on the Palestinian Authority committing to “much-needed reform”, including general elections in 2026 in which Hamas could play no part.

It was also based on a demilitarised Palestinian state. As part of that, Carney pledged to increase Canada’s efforts to support democratic governance in Palestine.

He said he had spoken at length with Palestinian Authority President Mahmoud Abbas to affirm his commitment to those goals.

Carney reiterated that militant group Hamas – which is listed as a terrorist organisation in Australia – must release all hostages it captured on October 7, 2023, disarm, and play no role in the future governance of a Palestinian state.

“Canada will always steadfastly support Israel’s existence as an independent state in the Middle East living in peace and security,” he said.

“Any path to lasting peace for Israel also requires a viable and stable Palestinian state, and one that recognises Israel’s inalienable right to security and peace.”

But in a statement, the Israeli foreign ministry said Canada’s position rewarded Hamas and harmed efforts to achieve a ceasefire in Gaza or a framework for releasing the remaining hostages.

Canada, a Commonwealth nation, joins France in planning to recognise Palestine at the United Nations General Assembly in September, while the United Kingdom says it will also recognise Palestine – unless Israel commits to an immediate ceasefire and takes urgent steps to end the humanitarian disaster in Gaza.

Its decision leaves Australia, which has so far rejected that step, increasingly isolated among its close allies.

Prime Minister Anthony Albanese says that while he has always supported a two-state solution, he did not want to “win a political point”.

Treasurer Jim Chalmers said Albanese and Foreign Minister Penny Wong would respond to Canada’s move “in due course”. He reiterated his view that Australian recognition of Palestine was a matter of “when, not if” and welcomed international momentum on the matter.

“In my personal view, I welcome momentum and progress made in the international community,” Chalmers told Sky News. “From an Australian point of view, recognition of Palestine is a matter of when, not if, so in that light, progress we’re seeing is welcome but also conditional.”

Albanese had a call with British Prime Minister Keir Starmer to discuss the situation overnight, a day after the UK’s major foreign policy shift.

Carney said he had spoken in recent days with Starmer, French President Emmanuel Macron and European Commission President Ursula von der Leyen.

The Canadian leader later told reporters that the reality on the ground – including the starvation of people in Gaza – meant “the prospect of a Palestinian state is literally receding before our eyes”.

“Canada condemns the fact that the Israeli government has allowed a catastrophe to unfold in Gaza,” he said.

Carney said the likelihood of a negotiated settlement between Israel and the Palestinian Authority had steadily and gravely eroded for several reasons. They included Hamas’ pervasive threat to Israel and its rejection of Israel’s right to exist, Israel’s accelerated construction of settlements in the occupied West Bank, a non-binding vote in the Israeli Knesset this month supporting the annexation of the West Bank, and Israel’s failure to improve the humanitarian situation in Gaza, he said.

At least 48 Palestinians were killed and dozens were wounded on Wednesday while waiting for food at a crossing in the Gaza Strip, according to a local hospital that received the casualties.

The latest violence around aid distribution came as Trump’s Middle East envoy Steve Witkoff – who has led the Trump administration’s efforts to wind down the nearly 22-month war and release hostages taken in Hamas’ October 7 attack that sparked the fighting – will arrive in Israel on Thursday for talks on the situation in Gaza.

Earlier on Wednesday, Malta announced it would also recognise Palestine in September. Christopher Cutajar, the permanent secretary at Malta’s Foreign Ministry, said the country had long supported self-determination for the Palestinian people and “as responsible actors, we have a duty to work to translate the concept of a two-state solution from theory into practice”.

Meanwhile, Israeli security cabinet member Ze’ev Elkin on Wednesday said Israel could threaten to annex parts of Gaza to increase pressure on Hamas, an idea that would deal a blow to Palestinian hopes of statehood on land Israel now occupies.

Accusing Hamas of trying to drag out ceasefire talks to gain Israeli concessions, Elkin told public broadcaster Kan that Israel may give the group an ultimatum to reach a deal before further expanding its military actions.

“The most painful thing for our enemy is losing lands,” he said. “A clarification to Hamas that the moment they play games with us they will lose land that they will never get back would be a significant pressure tool.”

The war began on October 7, 2023, when Hamas attacked communities in southern Israel, killing about 1200 people and taking another 251 hostage, according to Israeli tallies.

Since then, Israel’s offensive in the Gaza Strip has killed more than 60,000 people and laid waste to much of the territory, the Gaza health ministry says.

With Reuters, AP

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