U.S. President Donald Trump slapped 25% tariffs on all imports of steel and aluminum on Monday as he said over the weekend he would.
The executive order Trump signed at the White House restores tariffs he enacted against Canada in 2018 during his first term, which were later dropped after Canada retaliated with tariffs of its own. This time around it’s a blanket increase in duties on the entire world with the aim of restoring jobs to a declining industry on the premise offshore competitors will relocate to the U.S.
In the way that Trump threatened tariffs against Canada and Mexico as a way to get action on its borders and fentanyl smuggling, Monday’s order appears like a shot to open negotiations on a global scale about manufacturing vehicles, computer chips and medicines.
“We’ll be talking about other subjects, like cars,” Trump told reporters in the Oval Office. “We’ll be talking about drugs and pharmaceuticals, we’ll be discussing chips, and we’re going to be doing some other things in addition to that, all which will bring in a lot of jobs into our country.”
The steel and aluminum tariffs are to be imposed on Mar. 4, the same day his delayed 25% tariffs on all Canadian and Mexican goods are to take effect. He moderated those measures with a 10% duty on energy and critical mineral imports.
Canada’s federal government said early evening Monday the tariffs were “unjustified” but didn’t state retaliatory tariffs, at least yet. More word was expected. Opposition politicians Pierre Poilievre of the Conservatives and NDP leader Jagmeet Singh said Ottawa must counter in kind.
Canada-US
The proposed steel duty could have a huge impact on Chinese and European steelmakers but Canada and the U.S. are each the other’s biggest steel partners. Canada shipped 6 million tonnes of steel south last year, valued at about $20 billion. The higher duties are expected to snarl supply chains in the cross-border, highly integrated automaking sector, infrastructure building and a myriad of other industries dependent on the construction materials.
“These foreign companies will move to the United States, will make their steel and aluminum in the United States,” Trump said. “Ultimately, it’ll be cheaper, but we’ll also have jobs, many, many more jobs.”
Trump first said there would be no exceptions, but suggested in a news conference as he signed orders that Australia would get a reprieve because it buys more goods from the U.S. – such as jet planes – than the other way round. He said had been on the phone with Australian Prime Minister Anthony Albanese on Monday.
Canada would be unlikely to get an exemption, said Trump, repeating unfounded claims of a $200-billion trade deficit with its northern neighbour, and invitations for it to become the 51st state.
Steel industry
Catherine Cobden, president and CEO of the Canadian Steel Producers Association, called for Ottawa to retaliate swiftly and strongly against the U.S. Canada must also safeguard the industry against unfair trade from China and other nations that shed their overcapacity in steelmaking with under-priced product in the local market, Cobden said on CBC television.
The tariffs would cause immediate layoffs in Canadian steelmaking and would likely ripple into industries such as auto manufacturing, Cobden said. But she expressed optimism after reporting the Pittsburgh-based United Steelworkers Union said Canada should be exempt.
In the aluminum sector, Quebec would be the hardest hit in Canada. Its industry, which stretches back through its role as the key supplier of metal to build American planes and ships during World War Two, accounts for two-thirds of all American aluminum imports.
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