Trump Threatens Trade Fallout as Canada Moves to Recognise Palestinian State.
Canada’s announcement that it plans to recognise the State of Palestine at the United Nations this September has triggered a sharp response from U.S. President Donald Trump, who warned that the move could complicate trade relations between the two countries.
“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 posted on Truth Social, shortly after Canadian Prime Minister Mark Carney made the announcement.
With this decision, Canada could become the third major Western power—after France and the UK—to support recognition of Palestine at the upcoming UN General Assembly meeting, should the war in Gaza continue unabated. Carney clarified that Canada’s position is tied to a set of conditions, including the Palestinian Authority’s commitment to sweeping reforms and the exclusion of Hamas from the general elections planned for 2026.
“The deepening suffering of civilians leaves no room for delay in coordinated international action to support peace, security, and the dignity of all human life,” Carney said. “Preserving a two-state solution means standing with all people who choose peace over violence or terrorism.”
Canada had long maintained that recognition of a Palestinian state should come only after a negotiated peace with Israel. However, Carney said that escalating humanitarian concerns, especially in Gaza, had prompted a reassessment. “The prospect of a Palestinian state is literally receding before our eyes,” he noted, citing the worsening crisis in the region.
Trump’s remarks underscore potential diplomatic and economic tensions between Washington and Ottawa as the Palestinian issue gains renewed global focus.
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