OTTAWA -- Canada is planning to retaliate with countermeasures after U.S. President Donald Trump announced his plans to impose a 10-per-cent tariff on Canadian aluminum imports, despite condemnation from aluminum organizations on both sides of the border.
鈥淚n response to the American tariffs, Canada intends to swiftly impose dollar-for-dollar countermeasures,鈥� said Deputy Prime Minister Chrystia Freeland in a statement late Thursday, promising more information about the retaliatory measures 鈥渟hortly.鈥�
The federal government was informed by the U.S. administration that the new tariff was coming, and will apply to unprocessed Canadian aluminum, as of Aug. 16.
Freeland called Trump鈥檚 move
In announcing the new trade action at an event in Ohio, Trump said that: 鈥淐anada was taking advantage of us, as usual.鈥�
Trump claimed on Thursday that the American aluminum business has been 鈥渄ecimated鈥� by Canada, calling it 鈥渧ery unfair鈥� and accusing Canadian producers of flooding the U.S. with exports.
He also said that the new tariffs are 鈥渁bsolutely necessary,鈥� and pledged he will 鈥渁lways put American workers first,鈥� and use all tools at his disposal鈥攊ncluding tariffs鈥攖o do that.
The United States had been considering whether to slap tariffs on aluminum imports coming from Canada, under Section 232 of the U.S. Trade Expansion Act, unless Canada agreed to restrict its export volumes through quotas.
vowed to stand up for Canadian workers, echoing Freeland鈥檚 commitment to retaliate.
Responding to the initial threat, Trudeau said that the U.S. 鈥渘eeds Canadian aluminum,鈥� as it does not produce enough to fill its domestic manufacturing needs.
"If they put tariffs on Canadian aluminum, they鈥檙e simply increasing the costs of inputs, necessary inputs, to their manufacturing base which will hurt the American economy. Again, we see that our economies are so interlinked that punitive actions by the United States administration end up hurting Americans the same way they end up hurting Canadians," Trudeau said back in June.
INDUSTRY GROUPS ON BOTH SIDES AGAINST
Aluminum association groups on both sides of the Canada-U.S. border are speaking out about Trump鈥檚 move, and are in agreement that it鈥檚 the wrong approach.
Aluminum Association of Canada President & CEO Jean Simard told 麻豆影视 that Canadian producers are not dumping aluminum鈥攖he term for when selling under domestic price鈥攔ather that Canada is selling at the current international price.
鈥淭here鈥檚 no dumping. It鈥檚 a misuse of a word that is very well documented in international trade law. This is not dumping. This is quite an assumption by the president,鈥� Simard said.
In a statement, President and CEO of the Aluminum Association Tom Dobbins said his organization鈥� which represents aluminum production and jobs in the United States鈥攊s 鈥渋ncredibly disappointed,鈥� and said Trump鈥檚 move while trying to help will only add volatility to the industry as a whole.
鈥淭he administration failed to listen to the vast majority of domestic aluminum companies and users by reinstating Section 232 tariffs on Canadian aluminum. After years of complex negotiations and hard work by government, industry and other leaders across North America to make the U.S.-Mexico-Canada Agreement (USMCA) a reality, this ill-advised action on a key trading partner undermines the deal鈥檚 benefits at a time when U.S. businesses and consumers can least afford it,鈥� said Dobbins.
He added that the reports of a surge of imports from Canada are 鈥済rossly exaggerated,鈥� citing that showed that overall primary aluminum imports from the U.S. to Canada declined about 2.6 percent from May to June and are below 2017 levels.
鈥淭he few companies that stand to benefit from reinstated 232 tariffs on aluminum have cherry-picked government data and omitted important context to build their case, which unfortunately won the day,鈥� he said.
TRUDEAU ACCUSED OF INACTION
Reacting to the late-in-the-day news, several Conservative MPs issued a joint statement saying Trudeau has 鈥渙nce again let down鈥� thousands of Canadian aluminum workers.
鈥淭he U.S. administration has been foreshadowing new tariffs on Canadian aluminum for weeks, so why didn鈥檛 the Trudeau government take action to protect Canadian workers?鈥� reads the joint statement.
鈥淭he aluminum sector is vital to the Canadian economy. It鈥檚 essential that this industry thrive, especially during COVID-19,鈥� said the Conservative MPs.
In a statement, NDP MP and the party鈥檚 international trade critic Daniel Blaikie said his thoughts were with the aluminum workers who will be hurt by Trump鈥檚 鈥渆lectioneering鈥� and the lack of Liberal action at home. He is calling for a federal plan to help protect Canadian aluminum jobs.
Freeland agreed in her statement, that 鈥渢he last thing Canadian and American workers need is new tariffs that will raise costs for manufacturers and consumers, impede the free flow of trade, and hurt provincial and state economies.鈥�
NOT THE FIRST TIME
The Canadian Chamber of Commerce is also condemning the U.S. move., saying the tariffs will 鈥渙nly exacerbate disruptions to North American supply chains.
In a statement the Chamber鈥檚 Senior Director of International Trade Mark Agnew said that Canadian aluminum exports pose 鈥渁bsolutely no national security threat鈥� and the move is just as wrong as it was when it was tried by Trump in 2018.
Trump hit Canada with steel and aluminum tariffs in May 2018, during negotiations for the new NAFTA deal. The tariffs remained in place for a year, during which time Canada reciprocated with dollar-for-dollar countermeasures on American steel, aluminum, as well as levelling a surtax on other goods.
A year later, Canada and the U.S. issued a joint statement announcing a decision to lift the tariffs, confirming that the two nations also agreed to terminate World Trade Organization litigation Canada launched after slamming the U.S. tariffs as "punitive" and "an affront" to Canada-U.S. relations.
The new NAFTA came into effect on July 1, meaning this latest American trade action comes just over a month into the new deal.
The new rules of origin for automobiles within the new NAFTA state that 70 per cent of the steel and aluminum purchased by North American automakers has to be produced in North America.
CALLS TO RETALIATE
The largest private sector union has called on Trudeau to 鈥渟tand firm鈥� against the prospect of the re-imposition of tariffs and has suggested that Canada should retaliate.
Unifor National President Jerry Dias has previously called the prospective tariffs 鈥渢otally unwarranted.鈥�
Speaking to the prospect of the tariffs, Unifor National President Jerry Dias has called the prospective tariffs 鈥渢otally unwarranted.鈥�
Dias has said that the arguments that American steel producers are making to the Trump administration about the need for intervention 鈥� including that a surge in Canadian aluminum imports is causing aluminum prices to collapse 鈥� are 鈥減reposterous and utterly divorced from reality,鈥� because globally, due to COVID-19, demand for metal has gone down and that鈥檚 led to the declining prices.
The Conservatives have also called for immediate retaliation to 鈥渟end a clear message to the U.S. that we will not restrict our exports,鈥� and industry representatives are calling on Freeland to begin consulting the business community on what the government鈥檚 retaliatory response will be.
