Trudeau to kick off tour of steel and aluminum factories in Quebec

Pauline Gross
March 13, 2018

European Trade Commissioner Cecilia Malmstroem has promised that Europe would fight back against those who intimidate its trade after joint talks with US Trade Representative Robert Lighthizer and Minister of Economy, Trade and Industry of Japan Hiroshige Seko on exemption from Donald Trump's steel and aluminum tariffs came to a deadlock.

Freeland is coming off a tense week which started with the seventh round of NAFTA negotiations making little progress towards an agreement but ended with a sigh of relief when Canada and Mexico secured an exemption from new US tariffs on steel and aluminum imports.

Dutch Finance Minister Wopke Hoekstra said the tariffs are "a bad idea".

Alluding to the breakthrough, while not explicitly naming Mr. Trump, he said, "You've got to keep at it, you have to be relentless and if there's a setback, you just keep going find another approach". He temporarily exempted big steel producers Canada and Mexico - provided they agree to renegotiate a North American trade deal to his satisfaction.

It remains far from clear how, exactly, the Trump administration's tariffs will be applied, which countries will be subject to them or how economically damaging the retaliation from the affected nations might prove.

A USTR spokeswoman said last week that "any country with which we have a security relationship is welcome to discuss with the United States alternative ways to address our national security concerns with respect to steel and aluminum imports", adding: "If we arrive at a satisfactory alternative means to address our concerns, the president may remove or modify the restrictions".

He said other countries could be spared the tariffs if they can convince the United States government that their steel and aluminum exports don't threaten American industry. Canadian officials reacted strongly to threats of US tariffs on steel and aluminum.

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Trudeau said Canada had a lot more work to do and would press Washington to ensure the exemptions were permanent.

"We are anxious [about] the possibility of having a trade war between the United States and the European Union because we believe that there will be only losers".

And that doesn't factor in the costs borne from retaliation taken by foreign partners against unrelated USA industries. "While we strongly urge the President to reconsider this action, at minimum we hope that the administration will look to create an efficient exemption process for qualified USA companies in order to alleviate the harm that will be caused by the imposition of this tariff". "It has a negative impact on the NAFTA talks".

He also highlighted the strength of the national security relationship between the United Kingdom and the US.

Brussels is also looking at "safeguard" measures to protect its industry - restricting the bloc's imports of steel and aluminium to stop foreign supplies flooding the European market, which is allowed under World Trade Organization rules.

The decision is likely to play well in steel towns and the industrial mid-west but Congress representatives from agricultural, export-orientated states, will probably fear retaliation, as will those from the IT areas like Seattle and Silicon Valley, which rely on worldwide markets for their success.

The government mounted a multi-pronged campaign to secure the exemptions on tariffs. Canada produces some of the cleanest steel and aluminum in the world thanks to our focus on new technology and cleaner sources of energy. Whether specific countries are exempted or not, the uncertainty caused by Trump's action destabilizes companies' operations and causes unneeded confusion.

Other reports by GizPress

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