Trump, Carney say they had a productive call; Canadian tariffs still coming

By Doina Chiacu and David Ljunggren

WASHINGTON/OTTAWA, March 28 (Reuters) - U.S. President Donald Trump and Prime Minister Mark Carney on Friday had a conversation that both men described as productive, although the Canadian leader said Ottawa would be imposing retaliatory tariffs next week as promised.

The call was their first contact since Carney won the leadership of Canada's ruling Liberals on March 9. Carney says Trump's threat of tariffs is a betrayal of a once close economic and security relationship.

"It was an extremely productive call, we agree on many things, and will be meeting immediately after Canada's upcoming Election to work on elements of Politics, Business, and all other factors," Trump wrote on his social media platform Truth Social.

That work "will end up being great for both the United States of America and Canada," he added.

Trump - who often muses about annexing Canada - referred to Carney as the Canadian prime minister rather than as the governor of the 51st U.S. state, the term he often used to describe former Prime Minister Justin Trudeau.

"The president respected Canada's sovereignty today, both in his private and public comments," Carney told a press conference in Montreal, saying the phone call had been very cordial.

Carney on Thursday vowed to transform Canada's economy to be less dependent on the United States. Trump's tariff announcement is expected on April 2. Ottawa has made clear for months that it will impose countermeasures.

"I informed President Trump that my government will be implementing counter tariffs to protect Canadian workers and our economy following the announcement of new trade actions by the United States on April 2," Carney told the press conference.

The United States and its northern neighbor have long been close allies and trading partners. But relations quickly deteriorated after Trump took office in January.

Carney said the two leaders had agreed to begin comprehensive negotiations about a new economic and security relationship immediately after an election on April 28.

Canada, along with Mexico, is part of the United States-Mexico-Canada free trade deal that is scheduled to be reviewed next year. Carney said he did not know whether Mexico would take part in the talks on a new economic security relationship, adding it was Canada's preference that it be present.

Carney reiterated that Canada needed to find new trading partners and said that if he won the election, he would set up a C$5 billion trade diversification fund to help the construction of ports, railroads, inland terminals, airports, and highways.