By: Laura Steiner
US President Donald Trump has announced the United States would impose tariffs on Canadian steel, and aluminium products. 25 % will be assessed on steel products, while 10% penalty will be placed on aluminum products. The penalties were set to kick in midnight June 1, 2018.
The tariffs have been levied under national security provisions of section 232. Prime Minister Justin Trudeau has announced Canada would be matching them dollar for dollar. ” These tariffs are an affront to the long-standing security partnership between the United States and in particular to the thousands of Canadians who have fought and died alongside American comrades-in-arms.” The US has a trade surplus of $2 billion in steel with Canada. Canada buys what amounts to half of US steel trade exports.
The tariffs amount to approximately $16.6 billion. Foreign Affairs Minister Chrystia Freeland announced what are described as countermeasures. They are listed in two different tables according to value. Table details items related to steel, to be assessed at 25%. Table two is a list of other items from yogurt to toilet paper, and kitchenware, as well as aluminum based products to be assessed a 10% levy. The federal government also invites feedback on comments on the strategy. For more information click here. There is a two-week consultation period lasting until June 15.
Trump believes his country’s situation is unfair. “The United States has been taken advantage of for many decades on trade. Those days are over. Earlier today, this message was conveyed to Prime Minister Justin Trudeau of Canada: The United States will agree to a fair deal, or there will be no deal at all.” It is long thought that the tariffs on steel and aluminum are tied to a successful North America Free Trade Agreement (NAFTA) renegotiation. Canadian tariffs will take effect July 1, 2018.
Trump attacked trade barriers on agricultural businesses this morning via twitter. “Canada has treated our Agricultural business and farmers very poorly for a long period of time. Highly restrictive on trade! They must open their markets and take down their trade barriers.” Bilateral trade in agriculture is worth an estimated $47 billion.