Railway Tensions in Canada: Trudeau Urges for Resolution Amid Economic Threat

Canadian Prime Minister Justin Trudeau is urging Canadian National Railway, Canadian Pacific Kansas City, and the Teamsters union to resolve their differences to avoid a rail stoppage that could severely impact the nation's economy. Despite ongoing negotiations, no agreement has been reached, and the government may need to intervene.

Canadian Prime Minister Justin Trudeau urged on Wednesday the country's two main rail companies and the Teamsters union to settle their differences and avoid a stoppage that could cause billions of dollars worth of economic damage. However, the prospects of a last-minute deal dwindled later when Canadian National Railway said talks had broken down and called for government intervention.

CN Rail and Canadian Pacific Kansas City have threatened to lock out their workers early Thursday unless new deals are reached. This would mark the first time both companies shut down simultaneously. Negotiations have stalled, with both sides accusing each other of negotiating in bad faith.

Trudeau emphasized the need for a negotiated resolution, stressing that millions of Canadians depend on a functioning rail system. Federal Labor Minister Steven MacKinnon has met with executives from both rail companies, but no progress has been reported. Finance Minister Chrystia Freeland also highlighted the economic risks, urging both parties to resolve the issue swiftly.

Moody's Ratings agency estimates that a 75% shutdown of Canada's freight rail traffic would cost the economy C$341.5 million ($251 million) per day. Both business associations and the federal government are calling for immediate action to prevent significant economic damage.

(With inputs from agencies.)