Published: Sun, July 01, 2018
Worldwide | By Lisa Hogan

Canada finalizes tariffs on USA goods

Canada finalizes tariffs on USA goods

Chrystia Freeland, Minister of Foreign Affairs, visited Stelco in Hamilton on Friday, June 29, 2018 where she met with employees in the cold rolling plant and announced the government's latest efforts in response to USA tariffs on Canadian steel and aluminum.

"We're not going for the escalation, but will not retreat", said Freeland.

"They will take effect on July 1 and will remain in place until the United States eliminates its trade-restrictive measures against Canada".

Trudeau also spoke by phone with President Enrique Peña Nieto of Mexico.

"As he [Trudeau] has said in past conversations and in public, the prime minister conveyed that Canada has had no choice but to announce reciprocal countermeasures to the steel and aluminium tariffs that the United States imposed on June 1, 2018", Trudeau's office said in a statement.

"We believe that cooperation is a better path forward than escalation", said Kent Bacus, the association's director of global trade and market access.

Export Development Canada and the Business Development Bank of Canada have promised $1.7 billion in loans and services to assist the aluminum and steel sectors, including small- and medium-size business affected by the USA tariffs.

Canada is the largest importer of steel and aluminum into the U.S. In 2017, Canada imported $4.3 billion in steel and $7.2 billion in aluminum to the United States. Freeland called the idea "absolutely absurd".

The United States has a $ 2 billion trade surplus on iron and steel products with Canada, Freeland also pointed out, and Canada buys more American steel than any other country, accounting for 50 percent of USA exports.

Ottawa had been consulting on the proposed list of goods to mitigate any unintended consequences for Canadian businesses, though it is anticipated the tariffs and counter-tariffs will cost consumers on both sides of the border.

She is also expected to reveal the details of the federal government's plan to support Canada's tariff-targeted steel and aluminum industries. Speaking in front of a group of Stelco workers, she said she is confident common sense will prevail and that an "intensive phase" of talks in the renegotiation of the North-American free-trade agreement (NAFTA) will start quickly after Sunday's election in Mexico. "A lot of people appreciate that", she said in an interview Friday.

Trump has also threatened to slap a 25 per cent tariff on auto imports from Canada and ordered an investigation last month into whether such a move is warranted.

The tariff response it the latest development in an escalating spat between the two countries, which trade more than $500 billion in goods annually.

"Official U.S. government statistics show that the U.S.is in a small surplus with Canada", says Gordon Ritchie, who served as Canada's ambassador for trade negotiations in the 1980s.

"Canada has always been a safe, secure and reliable source of steel and aluminum for the USA market".

There are fears, however, that Canadian tariffs - some of which target businesses in states that are important to Trump and his supporters - could lead to fresh trade action from the U.S. Yes, it makes the story seem a bit silly when you learn the US exports canoes and maple syrup into Canada.

Ottawa would take measures to stop the dumping of steel in the coming weeks once it had finished consulting stakeholders, said Canadian Innovation Minister Navdeep Bains, appearing at the same event as Freeland.

The Trudeau government's decision to stand up to Trump with retaliatory measures has attracted wide support in Canada.

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