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Saturday, August 2, 2025
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Finance ministers talk fall budget

Canada to recognize palestine in September

Prime Minister MARK CARNEY plans to formally recognize the state of Palestine at a UN summit in September.

Carney announced the plan in a press conference yesterday afternoon, alongside Foreign Minister ANITA ANAND.

He said Canada will recognize Palestine at the general assembly of the UN in September.

His announcement followed the lead of French President EMMANUEL MACRON, who made the same commitment a week ago.

U.K. Prime Minister KEIR STARMER said earlier this week that his government would recognize Palestine at the summit, but left conditions under which the U.K. would abandon that position: a commitment by Israel to a ceasefire, a revival of talks toward a Palestinian state, and action by Israel to relieve suffering in Gaza.

In his remarks yesterday, Carney placed no conditions on Israel, but rather on the Palestinian Authority led by President MAHMOUD ABBAS, with whom Carney had spoken with personally earlier in the day. Canada has made its support contingent on the Palestinian Authority reforming its governance, holding elections in 2026, ensuring that Palestine does not “militarize,” and ensuring that Hamas plays no role in the future governance of Palestine.

“Hamas is not welcome, in any way, shape, or form,” said Carney.

Prime Minister Mark Carney held a press conference in the National Press Theatre yesterday. The Hill Times photograph by Andrew Meade

Carney pointed to actions by the Israeli government to explain why his government plans to take this step: its failure to prevent a humanitarian crisis in Gaza, and to rein in settlement building and violence in the West Bank, as well as a symbolic vote by the Knesset in favour of annexing the West Bank. He referred to “some in positions of influence in Israel” who are acting to undermine a two-state solution.

Several of the ministers in the Israeli government have called for the blockage of aid into Gaza, and for the annexation of Gaza and the West Bank.

Canada’s decades-long position of supporting a peaceful, negotiated two-state solution is “no longer tenable”, said Carney.

He reiterated a call for Hamas to release its hostages, and disarm. Carney also denounced antisemitism, and said his government will bring forward legislation this fall to outlaw willful obstruction of access to places of worship or other community institutions.

Israel’s ambassador to Canada, IDDO MOED, rejected Carney’s plan in a statement issued yesterday.

“Israel will not bow to the distorted campaign of international pressure against it,” read part of the statement. It also said that the support for Palestinian statehood “hardens Hamas’ position at the negotiation table at a most critical time.”

Carney’s announcement came hours after the publication of an open letter to him from 176 former high-level Canadian diplomats, which called on Carney to recognize Palestine, and increase pressure on Israel to allow more aid to flow into Gaza, among other things.

Carney also briefly addressed his trade negotiations with U.S. President DONALD TRUMP. He said it was possible that the talks will not end by Aug. 1, and that Canada-U.S. Trade Minister DOMINIC LEBLANC and other “senior officials” would remain in Washington in pursuit of a deal.

Champagne to discuss trade, budget, and major projects with P&T ministers

Finance Minister FRANÇOIS-PHILIPPE CHAMPAGNE is leading a virtual meeting with his peers from the provinces and territories today. 

His press secretary, AUDREY MILETTE, told Politics This Morning that Champagne will discuss the upcoming budget with the other finance ministers.

Champagne has been giving them regular updates on the federal government’s trade negotiations with the U.S., Milette said, and today he’ll give them the latest on this front. He will also talk about the measures the feds are taking to help Canadian industries reeling from tariffs, she said.

The group will also discuss the government’s “one Canadian economy” plan, and the list of major projects that will be eventually considered for fast-tracking under the Building Canada Act, Bill C-5. 

Champagne will ask the provinces and territories for an update on their work identifying priority projects for the fast-track list, and they will discuss how to proceed, Milette said. 

Politics This Morning also reached out to provincial and territorial finance ministers’ offices to find out what they are hoping to get out of today’s virtual meeting. 

MARISA BREEZE, the spokesperson for Alberta Minister NATE HORNER, said in a statement that he will advocate for “supporting infrastructure like pipelines and trade corridors,” and call for addressing “duplicative regulatory processes,” among other things.

“He’ll also encourage the federal government to ensure that their budget and spending review focus on fiscal responsibility and economic growth,” she said. 

U.S. court to hear arguments against Trump’s tariffs

A legal case by five U.S. businesses against President Trump’s “Liberation Day” tariffs will be heard in the U.S. Court of Appeals for the Federal Circuit at 10 a.m. today.  

The V.O.S. Selections, Inc. v. Trump lawsuit was filed by a U.S. public interest litigation firm, the Liberty Justice Centre (LJC), along with their co-counsel, on behalf of five plaintiffs impacted by tariffs.  

It argues that the president does not have the authority to impose such blanket levies on trading partners.

Trump used the justification of the fentanyl trade and national security for slapping tariffs on Canada, Mexico and China. He pointed to trade deficits with a host of other countries when he first announced these tariffs on April 2. Canadian goods that are covered by the Canada-U.S.-Mexico trade agreement are exempt from the tariffs. 

U.S. President Donald Trump greeting Prime Minister Mark Carney on May 6, 2025, at the White House. Official White House photograph courtesy of Gabriel B. Kotico

Trump deemed that day as a day of “liberation” for the U.S. economy, but paused the reciprocal tariffs on April 9, except for China, for 90 days after U.S. and global stock markets tumbled. 

He applied the tariffs by invoking the U.S. International Emergency Economic Powers Act (IEEPA). The LJC says Trump can only trigger powers under the legislation after declaring a “national emergency” in response to an “unusual and extraordinary threat” that originates outside of the United States, risking the country’s national security, foreign policy, or the economy. 

A trade deficit, it adds, is “neither an emergency nor an unusual or extraordinary threat.” The IEEPA does not authorize tariffs at all, and even if the legislation did allow such powers to the president, that would be an “unconstitutional delegation of Congress’s power to impose tariffs,” as per the firm.  

The primary complainant in the case is a New York-based wine and spirits importer, V.O.S. Selections

Its owner VICTOR SCHWARTZ told CNN during an interview in May that the tariffs would have a “very very negative impact” on the business, and he decided to get on board with the suit to do something about them. 

The lawsuit was first filed on April 14 with the U.S. Court of International Trade, which declared them “illegal” on May 28. The court imposed a “permanent injunction” banning their enforcement. 

Naturally, this did not go down well with the Trump administration, and the U.S. government filed a motion to stay the injunction while the court’s decision is under appeal. The second court, the U.S. Court of Appeals for the Federal Circuit, allowed the motion. 

Oral arguments will be heard in the appeal today, and the LJC informed Politics This Morning that it will be represented by the former acting solicitor general of the United States, NEAL KATYAL, as its co-counsel. The arguments will be livestreamed here

After the hearing, the LJC will hold a roundtable with journalists online  at 2 p.m. to discuss its next steps.

Elections Canada to send out voter information cards for Alberta byelection by today

Registered electors in the Battle River-Crowfoot, Alta., byelection will receive their voter information cards in the mail by today, Elections Canada has said. 

The card tells the residents where and when to cast their ballots, and it is given to anyone who is on Elections Canada’s preliminary and final list of voters. 

The byelection is taking place on August 18, but advance voting will take place from August 8 to August 11 from 9 a.m. to 9 p.m. MDT

More than 200 candidates have registered to run in the riding, the vast majority of which are connected to the electoral reform activist group the Longest Ballot Committee. 

Conservative Leader PIERRE POILIEVRE is also among those running, and is widely expected to win the seat handily. 

Conservative Party Leader Pierre Poilievre. The Hill Times photograph by Andrew Meade

Due to the massive list of candidates, Elections Canada will use “write-in” ballots for the byelection. Voters will have to write in the name of the candidate they are choosing. CBC News has more on it here

Freeland, Robertson prep for a grilling over ferry purchase

Transport Minister CHRYSTIA FREELAND and Infrastructure Minister GREGOR ROBERTSON have been scheduled to testify before a Commons committee on Friday.

The House Transport, Infrastructure and Communities Committee summoned the two ministers to explain the government’s decision to hand a $1-billion loan to B.C. Ferries, which used the cash to order four new ferries to be built in China. 

Conservative MP DAN ALBAS sits on the committee and called for the meeting. He criticized the ferry purchase as “essentially financing, with taxpayer dollars, the outsourcing of Canadian jobs to China.”

Freeland has likewise publicly criticized the B.C. government for using the loan to buy from China. B.C. Premier DAVID EBY and B.C. Ferries CEO NICOLAS JIMENEZ have defended the decision, arguing that B.C. shipyards don’t have the capacity to take on the project now, and the ferries are needed ASAP.

Jimenez is also among those scheduled to testify on Friday, as is EHREN CORY, the CEO of the Canada Infrastructure Bank, which issued the loan. 

Yesterday, Albas criticized the decision to hold the meeting on the Friday before a long weekend in a post to social media. 

Committee meetings are scheduled by committee chairs, in this case Liberal MP PETER SCHIEFKE

In the news

Tackling violence: Advocates for ending violence against women are calling on the Carney government to renew funding for the government’s National Action Plan to End Gender-Based Violence. RIDDHI KACHHELA reports

What’s the cabinet up to?

At 12:45 p.m., Artificial Intelligence Minister EVAN SOLOMON will deliver a speech at the Black Ideas Grant 2.0 event in Toronto. 

Prime Minister Mark Carney has no public events today, the PMO said last night in a release.

Evan Solomon
Artificial Intelligence Minister Evan Solomon. The Hill Times photograph by Sam Garcia

Today’s data

This morning Statistics Canada is releasing a bevy of fresh reports on topics that may be of interest to politicos and policy wonks: job vacancies and earnings, GDP by industry, air passenger traffic, and the prices of new condo apartments, among others. 

You can find those reports here beginning at 8:30 a.m.

Yesterday StatsCan reported that wind power production had increased in all provinces and two territories between May of 2024 and May of 2025, for a total uptick of 21 per cent.

In case you missed it

Bank of Canada holds key rate steady

The Bank of Canada maintained the key interest rate at 2.75 per cent yesterday, where it has been set since March.

As in previous decisions this year, the bank cited the unpredictability of U.S. trade policy as one of its reason to sit tight.

“With still high uncertainty, the Canadian economy showing some resilience, and ongoing pressures on underlying inflation, Governing Council decided to hold the policy interest rate unchanged,” read part of its news release.

The bank also released its Monetary Policy report yesterday. It again stressed the uncertainty caused by U.S. trade policy. The report showed that trade is down sharply, unemployment has risen, wage growth had slowed, and firms have produced more goods and services compared to demand than before. It predicted slow economic growth through to 2027, assuming the trade situation does not considerably worsen. You can check it out here.

Trump tariffs copper

Speaking of which, Donald Trump’s White House announced yesterday that it was imposing a 50 per cent tariff on imports of copper.

Canada exported at least $5.6-billion worth of copper products to the United States last year, according to Industry Canada data. 

We asked, you answered

Jim Fulton slapped a dead B.C. salmon onto Mulroney’s desk in the House in 1985

Former NDP MP JIM FULTON, who represented Skeena-Bulkley-Valley, B.C., from 1979 to 1993, was way ahead of his time in the fight against climate change. He was a talented MP, outspoken, bombastic, and charismatic. He was also theatrical and best known as the MP who slapped a dead salmon down on the desk of prime minister BRIAN MULRONEY during a testy debate on the sockeye fishery in the Skeena Valley in 1985.

Jim Fulton, pictured in Centre Block’s House foyer in 1990. The Hill Times photograph by Kate Malloy 

Congrats to RON COLUCCI, and kudos to everyone else who also answered correctly: ANNE MCGRATH, NATHAN NASH, MARC DESMARAIS, TREVOR NG, CHARLIE MARTIN, ROB EDWARDS, and ANDREA BENTON

TODAY’S POLITICAL TRIVIA QUESTION

A character based on a caricature of a former Quebec Liberal Senator is in MORDECAI RICHLER’s novel Solomon Gursky Was Here. Who was the Senator? 

Please email your responses by NOON today ET to trivia@hilltimes.com and the winner’s name will be highlighted in tomorrow’s Politics This Morning. All other participants’ names will also be included. 

The Hill Times