The United States is reimposing a tariff on raw Canadian aluminum products, U.S. President Donald Trump announced on Thursday.
A statement from the White House later confirmed the Trump administration signed a proclamation that reinstated a 10-per cent tariff “on imports of non-alloyed unwrought aluminum from Canada.”
A senior official told Global News the Canadian government is working behind the scenes to try to prevent the new tariff before it takes effect on Aug. 16.
The news came as the U.S. president touted his administration’s “Buy American” policies at a Whirlpool Corp. manufacturing plant in Ohio.
U.S. Trade Representative Robert Lighthizer said it’s “absolutely necessary” to reimpose the tariff on Canadian aluminum imports to defend the U.S. aluminum industry, Trump told the crowd.
“Canada was taking advantage of us, as usual,” Trump said. “I signed it… because the aluminum business was being decimated by Canada… very unfair to our jobs and our great aluminum workers.”
Amid talk earlier this summer that the U.S. was considering the possibility of more tariffs on aluminum, Prime Minister Justin Trudeau said increasing the price of aluminum for the U.S. would be a bad idea for both countries’ economies, particularly amid the economic fallout of the coronavirus pandemic.
“The U.S. doesn’t make nearly enough aluminum to be able to cover its needs, particularly at a time where we want the economies to get going again across North America,” Trudeau said on July 8.
Deputy Prime Minister Chrystia Freeland said in a statement the tariffs are “unwarranted and unacceptable.”
“Canadian aluminum does not undermine US national security. Canadian aluminum strengthens US national security and has done so for decades through unparalleled cooperation between our two countries,” she said.
“Canada intends to swiftly impose dollar-for-dollar countermeasures.”
The Trump administration last imposed steep tariffs of 25 per cent on Canadian steel and 10 per cent on Canadian aluminum back in 2018, during the renegotiation of the new North American Free Trade Agreement (now often referred to as CUSMA or USMCA).
Those tariffs were imposed under a controversial mechanism of American law known as Section 232 of the Trade Expansion Act. Canada then retaliated with a multi-billion-dollar round of tariffs on a wide range of American goods, also including steel and aluminum.
In May 2019, the two countries reached an “understanding” on Section 232 to lift all those tariffs. Trump said on Thursday his administration only agreed to do that because Canada promised it would not “flood our country with exports and kill all our aluminum jobs, which is exactly what they did.”
Since then, the White House statement claimed, “imports from Canada of the product that accounts for the largest share of Canada’s aluminum exports to the United States have surged above historical levels.”
“Canadian aluminum producers have broken that commitment,” the U.S. president said.
Calls mount for Canada to retaliate
Shortly after Trump’s announcement on Thursday, the Conservative opposition critics for international trade, foreign affairs and Canada-U.S. relations called on the Liberal government to “immediately retaliate and send a clear message to the U.S. that we will not restrict our exports.”
“The U.S. administration has been foreshadowing new tariffs on Canadian aluminum for weeks, so why didn’t the Trudeau government take action to protect Canadian workers?” the Conservative MPs said in a statement.
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The United Steelworkers union echoed the call for retaliation.
“The Trump administration is flouting the May 2019 agreement … which removed baseless Section 232 ‘national security’ tariffs on Canadian exports at that time,” Ken Neumann, the union’s national director, said in a news release. “The re-imposition today of these bogus U.S. tariffs on Canadian aluminum is now threatening thousands of Canadian jobs.”
The Canadian Chamber of Commerce was also quick to react, calling the reimposed aluminum tariffs “unjustified.”
“Canadian exports of aluminum pose absolutely no national security threat to the United States,” Mark Agnew, senior director of international trade, said in a news release. “Tariffs were the wrong instrument when they were first imposed in 2018, and they remain the wrong instrument now.
“At a time when our economies are struggling with the economic fallout of COVID-19, these tariffs will only exacerbate disruptions to North American supply chains.”
The U.S. Chamber of Commerce, for its part, warned Trump’s decision would raise costs for American manufacturers.
“The administration’s move to reimpose tariffs on aluminum from Canada is a step in the wrong direction,” Myron Brilliant, head of international affairs for the U.S. industry group, said.
Bruce Heyman, former U.S. Ambassador to Canada, decried the tariff on Twitter.
“This is a hostile act to Canada that clearly smacks of political intentions (versus) economic reality,” Heyman tweeted.
-With files from Global News’ Amanda Connolly, Mercedes Stephenson, Rachael D’Amore, The Canadian Press and Reuters
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