US President Donald Trump recently sent a letter to Iran’s supreme leader, Ayatollah Ali Khamenei, asking for negotiations over a new nuclear deal. While Tehran had reasons to be sceptical about the feasibility of such talks prior to 2025, the US’s behaviour towards Canada in recent weeks may highlight a significant flaw in Mr Trump’s overtures. Washington has plenty of ground to cover for it to recover its credibility when it comes to upholding deals.
The US Constitution ensures that the country’s leadership changes regularly, meaning that long-term deals signed by a previous president may be deemed unsatisfactory by the current one. However, in general, American presidents have tended to abide by preceding agreements either because of a pre-existing bipartisan consensus on a particular issue or because they understand that it helps maintain the country’s credibility when striking deals.
Naturally, exceptions arise when external circumstances have changed sufficiently to warrant withdrawal from an agreement. For example, in 2002, then president George W Bush withdrew from the Anti-Ballistic Missile Treaty that the US had signed with the Soviet Union in 1972 to pursue a national missile defence system. Yet, this is not a very common occurrence.
During his first term, Mr Trump pulled out of several high-profile agreements, most notably the Iranian nuclear deal. Another casualty was the North American Free Trade Agreement, which then-president Bill Clinton had negotiated with Canada and Mexico in 1993. Upon succeeding Barack Obama in 2017, Mr Trump demanded renegotiation of the deal, spawning the 2018 US-Mexico-Canada Agreement, or USMCA.
While opposing deals struck by one’s predecessors is conceivable in the context of political expediency, in 2025, Mr Trump has ratcheted up his disruption by opposing a deal he himself struck. Upon assuming office in January, he immediately threatened Canada and Mexico with more tariffs in violation of the USMCA, citing a failure of both countries to prevent illegal border crossings and the smuggling of the opioid drug fentanyl. While negotiations have ensued, they have led to the outbreak of a full-blown trade war between Canada and the US, with the new Canadian Prime Minister Mark Carney making it clear that the US’s ally to the north will respond in kind and refuse to capitulate.
If Mr Trump is earnest in his expressed desire for negotiations with Iran, then his behaviour towards Canada is counterproductive. Iranian elites will wonder what purpose a deal with the US serves if the US itself doesn’t stick to deals. If Iran’s leadership is willing to suffer the possible domestic setback of agreeing to negotiate with what it perceives to be a capricious bully, it had better get something tangible and enduring in return. Having the US renege a few years later would make the Iranians who supported negotiations appear even weaker in the eyes of their domestic opponents, who would surely be insisting: “I told you so.”
The absence of any discernible goals makes American behaviour towards Canada particularly puzzling.
As Ukrainian President Volodymyr Zelenskyy witnessed starkly over the past month, Mr Trump has no issue with disclosing his demands publicly, no matter how exploitative or unfair they may appear to external observers. Yet, in the case of Canada, it is unclear what the US’s northern neighbour is being asked to do. Mr Trump hasn’t invoked any sort of force majeure clause whereby the world has changed in an unforeseen manner since 2018, requiring all deals to be renegotiated. Instead, Ottawa is left with statistically implausible claims about humans and drugs crossing the border, besides a deluge of jingoistic rhetoric about Canada somehow ripping the US off.
The US President’s behaviour is rendered even more baffling when one realises that most of Washington’s demands (if any exist) could probably have been met through direct, cordial engagement with Canada. The two countries have had exceptionally good relations, with open communications and close co-operation on everything from trade to security, the environment, defence, human rights and beyond.
Given Mr Trump’s repeated calls for Canada to become the 51st state, one might argue that he is using economic tools to coercively expand the union. As Mr Carney’s elevation indicates, however, Canadians are a proud people with no intention of being subsumed into the US. Moreover, from the US perspective, absorbing Canada is unnecessary since it is aligned with Washington on virtually every substantive foreign policy issue.
While it is tempting to conclude that there must be some 3D chess being played by the White House, for now, the more plausible explanation is that Mr Trump is picking a needless fight just to play to his base, and to cultivate a reputation as a “tough negotiator”.
Unfortunately, his tactics are quite possibly preventing him from realising that his unprovoked aggression towards Canada is making the far bigger prize – a new deal with Iran – even less likely than it was in 2024. There should be little surprise if the Iranians string the Americans along with protracted behind-the-scenes negotiations before Washington eventually calls them off.
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Email sent to Uber team from chief executive Dara Khosrowshahi
From: Dara
To: Team@
Date: March 25, 2019 at 11:45pm PT
Subj: Accelerating in the Middle East
Five years ago, Uber launched in the Middle East. It was the start of an incredible journey, with millions of riders and drivers finding new ways to move and work in a dynamic region that’s become so important to Uber. Now Pakistan is one of our fastest-growing markets in the world, women are driving with Uber across Saudi Arabia, and we chose Cairo to launch our first Uber Bus product late last year.
Today we are taking the next step in this journey—well, it’s more like a leap, and a big one: in a few minutes, we’ll announce that we’ve agreed to acquire Careem. Importantly, we intend to operate Careem independently, under the leadership of co-founder and current CEO Mudassir Sheikha. I’ve gotten to know both co-founders, Mudassir and Magnus Olsson, and what they have built is truly extraordinary. They are first-class entrepreneurs who share our platform vision and, like us, have launched a wide range of products—from digital payments to food delivery—to serve consumers.
I expect many of you will ask how we arrived at this structure, meaning allowing Careem to maintain an independent brand and operate separately. After careful consideration, we decided that this framework has the advantage of letting us build new products and try new ideas across not one, but two, strong brands, with strong operators within each. Over time, by integrating parts of our networks, we can operate more efficiently, achieve even lower wait times, expand new products like high-capacity vehicles and payments, and quicken the already remarkable pace of innovation in the region.
This acquisition is subject to regulatory approval in various countries, which we don’t expect before Q1 2020. Until then, nothing changes. And since both companies will continue to largely operate separately after the acquisition, very little will change in either teams’ day-to-day operations post-close. Today’s news is a testament to the incredible business our team has worked so hard to build.
It’s a great day for the Middle East, for the region’s thriving tech sector, for Careem, and for Uber.
Uber on,
Dara
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