US-ally trade wars

‘We will not back down’: Canada puts tariffs on US$12.6 billion of US goods, gives state support to local companies

Canada will apply a 25 per cent tariff on steel products, and 10 per cent on aluminium and consumer goods

PUBLISHED : Saturday, 30 June, 2018, 2:46am
UPDATED : Saturday, 30 June, 2018, 3:11am

Canada has slammed the US with counter-tariffs on C$16.6 billion (US$12.6 billion) of American goods, while pledging money to support companies and workers hurt by US levies on Canadian steel and aluminium exports.

Canadian Foreign Minister Chrystia Freeland announced the final measures on Friday, saying that they would take effect on Canada’s July 1 national holiday. The tariffs mirror the value of those imposed by US President Donald Trump’s administration.

“We will not escalate, and we will not back down,” Freeland told reporters at a steel mill in Hamilton, Ontario. “We are acting in very close collaboration with our like-minded partners in the European Union and Mexico.”

She also reiterated the US measures are “illegal” and America has a trade surplus with Canada on iron and steel.

Justin Trudeau’s government will apply a 25 per cent tariff on steel products, and 10 per cent on aluminium and consumer goods. The list of more than 250 goods subject to Canadian duties include Florida orange juice, and Kentucky bourbon.

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Products like beer kegs, mustard and certain jams were removed from the final list, which otherwise does not stray far from an earlier proposal.

The levies will remain in effect until the US eliminates its tariffs on Canadian steel and aluminium.

Canada will provide as much as C$2 billion in assistance for affected workers, including plans to expand a work-sharing programme and enhancements to a corporate innovation fund, similar to steps the government took to cushion the impact of a softwood lumber spat.

The Americans have applied tariffs to Canadian softwood lumber, and are threatening to do so on autos.

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The latter move is seen as a major threat to Canadian growth and to the North American auto sector, since US carmakers rely heavily on supply chains that include its two neighbours.

The US and Canada are also in talks to update the North American Free Trade Agreement, which includes Mexico.

 Additional reporting by Agence France-Presse