Steel and aluminum tariffs were initiated today by U.S. President Donald Trump as he signed a presidential proclamation while surrounded by workers from the two industries at the White House today. (Leah Mills/Reuters)

Steel tariffs: Canada exempt for now


Steel tariffs of 25 per cent on “foreign steel” were announced by American President Donald Trump this afternoon.

“Our industries have been targeted for years and years by unfair foreign trading practices” 

Aluminium imports into the United States will also be subject to a tariff, at the rate of 10 per cent.

Scrap aluminum to be reprocessed into aluminium slabs is shown at a factory in Brampton, Ontario. Canada supplies almost half of all the aluminium that the U.S. consumes each year. (Norm Betts/Bloomberg/CBC)

Canada, which sells about 90 per cent of the steel produced in this country to the United States, is exempt for now.

Trump said that while the North American Free Trade Agreement (NAFTA) is being re-negotiated, Canada and Mexico will be exempt.

If, however, the negotiations do not go in the direction the U.S. president wants, then the NAFTA will be “torn up” and steel and aluminum tariffs will be imposed.

$15 billion of the two metals combined were exported to the U.S. last year.

In the event of a breakdown over NAFTA, these tariffs would likely bring swift retaliatory tariffs on U.S. goods imported into Canada.

“Our industries have been targeted for years and years by unfair foreign trading practices,” Trump said at the televised signing ceremony, “And that’s going to stop.”

Mark Warner, trade lawyer and principal at MAAW Law in Toronto, referred to the temporary exemption as “a minor victory”.

“This is on balance a good thing today,” he said in an interview this afternoon with CBC News Network.

“We didn’t get caught up in the application of this thing,” but it will likely loom large in the background of NAFTA discussions.

And Warner questioned whether tariffs will resurrect the U.S. steel industry the way Trump is boasting they will.

“We’ll see how far this really goes,” he said. “When you take Canada and Mexico out of the equation, you’re taking an awful lot of American steel imports out …. Realistically, is that enough left over there to really ramp up American production in a significant way? Probably not.”

(With files from CBC, Bloomberg and Reuters)

Posted in Economy, International, Politics

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