US steel tariffs will 'unleash chaos': Hamilton Chamber of Commerce

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In announcing his country's response, Canadian Prime Minister Justin Trudeau said it was "inconceivable" that "Canada could be considered a national security threat to the United States", noting that USA fighter planes and tanks contain Canadian steel.

The trade penalties, which included a 25 percent tax on imported steel and a 10 percent tax on imported aluminum, will be in effect starting Thursday at midnight.

The EU had "no choice" but to bring a case before the World Trade Organization and impose duties on USA imports, he added.

Jean-Claude Juncker, president of the European Commission, added that the USA tariffs are "protectionism, pure and simple".

That announcement came about a month after the Canada Border Services Agency was granted extra powers to identify businesses that try to dodge import duties and ship cheap foreign steel and aluminum through the Canadian market.

"This is the strongest trade action Canada has taken in the post-war era". In fact, they account for half of US steel exports. If these other countries are unwilling to lower their trade barriers, then a tariff would at least shut out their exports.

The trade official said that the tariff issue brought additional "noise" to NAFTA negotiations but added that it was significant that Mexico isn't alone in facing increased protectionism from its northern neighbor.

Malmström added the EU's response will be "proportionate and in accordance with WTO rules", and the "US measures clearly go against agreed worldwide rules".

Prior to the announcement, a senior Canadian official, speaking on condition of anonymity due to the sensitivity of the situation, confirmed Canada has prepared a list of US products that might face retaliatory tariffs, but declined to give further details.

Since Mr Trump's announcement in March, companies in the United States that buy metals have already reported higher steel prices and and complained that U.S. producers do not have the ability to meet demand.

Trump had been widely expected to impose tariffs on European steel and aluminum imports after failing to win concessions from the European Union.

German Chancellor Angela Merkel stressed her opposition even before the USA announcement, saying the looming tariffs were incompatible with WTO rules.

The White House defended the move by invoking national security as it stated excessive levels of aluminum and steel imports threatened to impair the security of the United States.

The EU said it would retaliate with tariffs on products like United States bourbon. Europe, along with Canada and Mexico had been granted a temporary reprieve since President Trump first announced the tariffs in March.

This comes after US and EU trade officials spent two months trying to reach an agreement to create a tariff exemption for European countries.

It prompted threats of retaliation from the European Union on United States products before the policy was abandoned.

Freeland pointed out that 50 per cent of American steel exports go to Canada, calling her government's countermeasures "meaningful". "We did everything to avoid this outcome".

Mexico announced what it described as "equivalent" measures on a wide range of US farm and industrial products.

Ross himself heads to Beijing on Friday where he will attempt to get firm deals to export more US goods in a bid to cut America's $375 billion trade deficit with China.

  • Rogelio Becker