Send this page to someone via email This week, U.S. President Donald Trump announced he will slap steep tariffs on Canadian aluminum and steel and in retaliation, Canada vowed to impose a slew of hefty countermeasures designed to hit Trump where it hurts. But how much will those measures hurt Canadian and American consumers? READ MORE: Donald Trump takes another swipe at Canada’s ‘trade barriers,’ treatment of U.S. farmers On Thursday, Trump said he would not renew temporary exemptions for Canada and several other American allies from import duties of 25 per cent on steel and 10 per cent on aluminum that were first imposed in March and go into effect immediately. Hours later, Prime Minister Justin Trudeau and Foreign Affairs Minister Chrystia Freeland announced $16.6 billion worth of Canadian tariffs that will be applied on July 1. Story continues below advertisement Those Canadian tariffs target everything from whisky to washing machines and peanut butter to pedicure products — in addition to steel and aluminum. “This is $16.6 billion of retaliation,” Freeland said Thursday. “This is the strongest trade action Canada has taken in the post-war era. This is a very strong response, it is a proportionate response, it is perfectly reciprocal. This is a very strong Canadian action in response to a very bad U.S. decision.” READ MORE: Donald Trump takes another swipe at Canada’s ‘trade barriers,’ treatment of U.S. farmers Here’s what consumers on both sides of the border may potentially pay more for as a result. June 1 Essentially, consumers can expect to pay a little more for American-made products largely made of steel and aluminum. Story continues below advertisement Vehicles Walid Hejazi, associate professor of international business at the University of Toronto’s Rotman School of Management, suggests that Canadians will likely see a bump in the price of U.S.-made vehicles. “So, now what will happen is that cars that are not made in the U.S. will be less expensive,” Hejazi said. “The steel and aluminum industry in the U.S., those people are unbelievably happy. Every other industry that uses steel, they are infuriated.” READ MORE: Canada retaliates against U.S. steel, aluminum tariffs, announces dollar-for-dollar ‘countermeasures’ “So, now everything in the U.S. that uses steel, those prices are going up and that’s going to hurt the car industry,” Hejazi said. Unifor, which represents Canadian auto industry employees, said the tariffs against Canada will hurt the auto industry on both sides of the border, resulting in higher costs for consumers. “Canada must take swift action to defend Canadian industries & workers for unjust attacks by the U.S.,” Unifor said in a tweet after the tariffs were announced Thursday. “The auto supply chain is completely intertwined. A cost increase of this magnitude will drive consumers directly into the arms of Japanese carmakers,” Unifor national president Jerry Dias said in a statement in March when the tariffs were first announced. Story continues below advertisement Recreation vehicles In March, U.S.-based National Marine Manufacturers (NMMA) also released a statement saying aluminum tariffs will make boat production more expensive. “While these tariffs are meant to protect American manufacturing, they do just the opposite. U.S. manufacturers, like those in our industry, which use American-made aluminum, depend on a competitive global market and fair pricing,” NMMA president Thom Dammrich said in the release. READ MORE: From pork to jeans — countries threaten tariff retaliation for U.S. steel, aluminum duties “The implementation of these aluminum tariffs, in combination with the additional, even larger tariffs on aluminum sheet proposed by the Department of Commerce, will drive up the costs of the aluminum used to manufacture more than 111,000 aluminum boats, such as pontoons and fishing boats, which make up 43 per cent of new powerboat sales each year.” Polaris, which manufactures snowmobiles and all-terrain vehicles, said in March it could expect a bump in cost of about one per cent. Chief executive officer Scott Wine told Reuters that the company spends more than $300 million annually on steel and aluminum and Polaris would have to “mitigate the inevitable price increases from our domestic steel suppliers” as a result of the tariffs. Canned products Products packaged in aluminum, such as beer, could cost more for Canadians after the tariffs are implemented. Story continues below advertisement In February, a letter released jointly by several organizations whose products are packaged in aluminum — including PepsiCo, Coca-Cola, the Beer Institute, etc. — warned that tariffs would make it more expensive to brew and package beer. The letter claimed that a 10 per cent tariff on aluminum would cost beer and beverage producers $256.3 million, a 20 per cent tariff would cost $512.5 million and a 30 per cent tariff would run $768.8 million. Canada’s countermeasures on July 1 While Trump’s tariffs target steel and aluminum, the Canadian tariffs are extensive. Forty-four types of steel and steel alloy products will be hit with the 25 per cent tariff. As well, 84 types of other products are being slapped with the 10 per cent tariff. READ MORE: What U.S. steel, aluminum tariffs mean for Canadians — and their wallets Which goods are included on that list? Yogurt, coffee, prepared meals like frozen pizza and dinners, detergent, whiskies, beer, lawnmowers, heaters, sleeping bags, mattresses, and a range of office supplies including felt-tip pens. Also on the list of 10 per cent tariffs are non-household dishwashing machines, combined fridge-freezers, household laundry machines, sailboats, motorboats, chocolate, maple syrup, licorice, toffee, nut butters, jams, orange juice, cucumbers and gherkins, soy sauce, ketchup, mustard, mayonnaise, flavoured water, shaving products, hair lacquers, manicure and pedicure products, and soups. Story continues below advertisement WATCH BELOW: Peanut butter tariff: EU threatens one in response to proposed U.S. steel, aluminum duties 1:16 Peanut butter tariff: EU threatens one in response to proposed U.S. steel, aluminum duties Peanut butter tariff: EU threatens one in response to proposed U.S. steel, aluminum duties – Mar 7, 2018 All those tariffs will work by imposing a levy on manufacturers when they ship their goods north of the border and in turn, those companies will likely pass on those costs to consumers.<doc-sep>(Reuters) - Canada will impose retaliatory tariffs on C$16.6 billion ($12.8 billion) worth of U.S. exports and challenge U.S. steel and aluminum tariffs under the North American Free Trade Agreement and the World Trade Organization (WTO), Canadian Foreign Minister Chrystia Freeland said on Thursday. Slideshow ( 4 images ) The Canadian tariffs are set to go into effect on July 1 and stay in place until the United States lifts its own measures, Freeland said, hours after the United States said it would impose tariffs on aluminum and steel imports from Canada, Mexico and the European Union. “The American administration has made a decision today that we deplore, and obviously is going to lead to retaliatory measures, as it must,” Prime Minister Justin Trudeau said at a news conference in Ottawa with Freeland. “We regret that. We would much rather move together in partnership,” he said. The Canadian government released two lists of U.S. products, proposing a 25 percent tariff on the first list and 10 percent on the second. Freeland said a 15-day consultation period would give Canadians a chance to comment on the tariffs and the products covered. The list included steel and aluminum in various forms, but also orange juice, maple syrup, whiskey, toilet paper and a wide variety of other products. It largely spares U.S. farmers. Among the few proposed agricultural targets are farm chemicals and cucumbers. (For the lists of U.S. products, see: bit.ly/2xtZlkz) Freeland said Canada would challenge the U.S. tariffs under both NAFTA’s Chapter 20 and the WTO’s dispute settlement process, and would work with other WTO members. Canadian Steel Producers Association President Joseph Galimberti said his organization was consulting with members and studying the products covered. “I think the key going forward is to take this time to make sure that it works for the parties most directly affected and to get those measures in place as soon as we can,” he said. Shares in StelCo Holdings Inc fell 3.5 percent, while the broader Canadian stock index ended up 0.1 percent. Trudeau also discussed NAFTA talks, saying Canada, the United States and Mexico had come so close to a deal that he had offered to meet personally with President Donald Trump in Washington. Trudeau said Vice President Mike Pence told him on Tuesday that as a precondition for that meeting, Trudeau would have to agree to a five-year sunset clause. He refused. A sunset clause would allow one of the three NAFTA members to quit the pact after five years. “There was the broad lines of a decent win-win-win deal on the table,” said Trudeau.<doc-sep>Canada is countering the United States' move to slap punishing tariffs on steel and aluminum imports by imposing dollar-for-dollar tariffs of its own on everything from steel products to maple syrup. Foreign Affairs Minister Chrystia Freeland said Canada is hitting back with duties of up to $16.6 billion on some steel and aluminum products and other goods from the U.S. — including beer kegs, whisky, toilet paper and "hair lacquers." She and Prime Minister Justin Trudeau made the announcement at a press conference hours after U.S. Secretary of Commerce Wilbur Ross confirmed the United States is following through on its threat to impose tariffs of 25 per cent on imported steel and 10 per cent on imported aluminum, citing national security interests. "This is the strongest trade action Canada has taken in the post-war era. This is a very strong response, it is a proportionate response, it is perfectly reciprocal," Freeland told reporters. Freeland says Canada retaliating with $16.6 billion in trade actions Politics News 0:42 Chrystia Freeland spoke to reporters in Ottawa on Thursday 0:42 "This is a very strong Canadian action in response to a very bad U.S. decision." The government is soliciting public comments on its plans until June 15. The new Canadian tariffs would kick in July 1. Trudeau called the Trump administration's national security argument "inconceivable" and called the tariffs "an affront to the Canadians who died" alongside Americans in battle. "We will continue to make arguments based on logic and common sense and hope that eventually they will prevail against an administration that doesn't always align itself around those principles," said Trudeau. Before today's announcement of Canada's countermeasures, a senior government source with direct knowledge of the talks said the cabinet committee on Canada-U.S. affairs met Thursday morning to discuss an appropriate response, describing its efforts as "finding a sweet spot." The source said the challenge was to come up with a response that makes sense and allows Canada to be a "credible country." Foreign Affairs Minister Chrystia Freeland lays out Canada's response to U.S. tariffs Politics News 8:03 Foreign Affairs Minister Chrystia Freeland speaks with Power & Politics host Vassy Kapelos about Canada's retaliation against U.S. tariffs on steel and aluminum 8:03 Exports to the United States represent about 45 per cent of Canadian steel production, according to the Canadian Steel Producers Association. Steel is produced in five provinces, but the industry is heavily concentrated in Ontario. U.S. President Donald Trump had granted exemptions on the tariffs to his North American Free Trade Agreement allies and the European Union, but those were set to expire June 1. During a call with reporters Thursday morning, Ross said Canada's and Mexico's exemptions were linked to the progress of the NAFTA negotiations, which "are taking longer than we had hoped." Trudeau revealed Thursday that he had offered to go to Washington last week to work out NAFTA details with the president, indicating final negotiations were close — but backed out when he got a call from Vice-President Mike Pence telling him that a meeting could only happen if Canada accepted a controversial sunset clause. The clause would force all three NAFTA countries to proactively agree — every five years — that they will remain in the trade pact. If they failed to agree, the deal would be killed automatically. Trudeau called Pence's offer "totally unacceptable." Mexico, EU to retaliate Mexico responded swiftly with tariffs of its own on U.S. exports of pork bellies, grapes, apples and flat steel, the Associated Press reported. The EU also announced it would launch a dispute settlement case at the WTO and impose "rebalancing measures." "Today is a bad day for world trade. We did everything to avoid this outcome," said EU Commissioner for Trade Cecilia Malmström. "The U.S. has sought to use the threat of trade restrictions as leverage to obtain concessions from the EU. This is not the way we do business." Ross tried to deflect suggestions the tariffs would damage ongoing NAFTA talks and the upcoming G7 meetings in Quebec. In justifying the tariffs in March, Trump invoked a 'national security' reasoning. (Sean Kilpatrick/Canadian Press) "If any of these parties does retaliate, that does not mean that there cannot be continuing negotiations," Ross said. "They're not mutually exclusive behaviours." But questions about the tariff announcements did loom over the start of the G7 finance ministers' meeting in Whistler, B.C. Thursday. Finance Minister Bill Morneau said the G7 representatives — among them, U.S. Secretary of the Treasury Steve Mnuchin — will strive to work together despite the Trump administration's decision. "When we face challenges, we can't get through them without talking," said Morneau. "We're not saying there won't be frictions. We're not saying that we won't have strong words. We're not saying we won't be able to send messages. We need to send messages saying that working together is better than working apart." Ross did leave some leeway, saying the U.S. could be flexible. "We continue to be quite willing, and indeed eager, to have further discussions," Ross said. Security reasoning questioned Conservative Leader Andrew Scheer said the Trudeau Liberals missed an opportunity to write a tariff contingency plan into the last federal budget, but tempered his criticism by insisting that free trade only works when it is "reciprocal." "Conservatives believe in free trade but that free trade has to be reciprocal. It has to go both ways for our workers to benefit from it," he said. Canada's procurement minister cast doubt on the U.S.'s national security justification. "It is very difficult to fathom that there would be a security risk imposed by Canada on the United States," said Public Services and Procurement Minister Carla Qualtrough. She was in Ottawa attending Cansec, Canada's largest annual arms show. She said the federal government has "contingency plans" in place to absorb the impact of U.S. tariffs on steel and aluminum on defence projects. Multi-billion-dollar programs to buy new fighter jets and warships are all heavily dependent on the price of steel.<doc-sep>The Trump administration on Thursday slapped tariffs on steel and aluminum imports from Canada, Mexico and the European Union, prompting outrage from America’s closest allies and major trading partners and setting off a trade war that could see U.S. consumers pay more for everything from canned soup to cars. The move to implement tariffs under the guise of national security measures triggered strong response across the globe, including a firm reproach from Canadian Prime Minister Justin Trudeau, who denounced the punitive tariffs as "totally unacceptable" and "an affront," saying that the very idea that Canada could be considered a national security threat to the United States is "inconceivable." Canadian Foreign Minister Chrystia Freeland announced $12.8 billion in retaliatory tariffs, which she called "the strongest trade action Canada has taken in the post-war era." Mexico also responded to the taxes, saying it would impose tariffs of its own, and the European Commission promised legal action. U.S. Commerce Secretary Wilbur Ross confirmed to reporters in an early-morning phone call that the White House will add a 25 percent import tariff on steel and a 10 percent tariff on aluminum after trade talks crumbled ahead of a June 1 deadline that would have enabled exemptions. Market reaction was also swift: The Dow Jones fell sharply after the move was announced, dropping by 250 points as investors took measure of the impact of the ongoing trade tensions, and falling to 300 points after Canada's retaliation. The European Commission fired back at the White House's trade decision with a lawsuit, saying the E.U. “stands now ready to react to the U.S. trade restrictions on steel and aluminum in a swift, firm, proportionate and fully WTO-compatible manner," referring to the World Trade Organization. The E.U. said it would launch legal proceedings against the U.S. in the WTO on Friday. The level of tariffs to be applied will reflect the damage caused by the new U.S. trade restrictions on E.U. products, it said. Mexico’s Ministry of Economy released a statement saying, “Mexico deeply regrets and rejects the decision of the United States to impose these tariffs on imports of steel and aluminum from Mexico as of June 1, under the criterion of national security. Mexico will impose equivalent measures to various products in the face of U.S. protectionist measures.” President Donald Trump, who has made no secret of his desire to implement more protectionist trade policies, announced in March that he planned to institute tariffs, saying, "People have no idea how badly our country has been treated by other countries.” "These tariffs are totally unacceptable," said Trudeau in a press conference Thursday afternoon. "Over the past 150 years, Canada has been America's most steadfast ally. These tariffs are an affront to the long-standing security partnership between Canada and the United States, and in particular, to the thousands of Canadians who have fought and died alongside American comrades-in-arms." Starting July 1, Canada will levy "dollar-for-dollar" tariffs on a selection of American-made goods, said Freeland, announcing that the government had drawn up two lists of products that would be subject to either 25 percent or 10 percent taxation, until the U.S. changed its position. "This is not about the American people. We have to believe that at some point their common sense will prevail. But we see no sign of that in this action today by the U.S. administration," said Trudeau. Experts who support free trade warned at the time about the potential consequences. “Overall, the idea of imposing tariffs to help the steel and aluminum industries is really misguided and will lead to a decline in overall economic activity.” "It will open a Pandora's box," said Dan Ikenson, director of the Cato Institute’s trade policy studies center. Robert Scott, senior economist at the left-leaning Economic Policy Institute, said tariffs that failed to distinguish between America's trade allies and countries like China, which the U.S. has accused of illegal trade practices, could make it more difficult resolve trade disputes. “What you try to do when you retaliate is push politically where it really hurts,” said Jacob Kirkegaard, a senior fellow at the Peterson Institute for International Economics. The retaliatory tariffs suggested so far primarily target Republican-leaning states, but if the tit-for-tat continues, a broader swath of the American economy could be drawn into the dispute. And in the long run, higher prices on imported goods would be something no consumers could escape. “Overall, the idea of imposing tariffs to help the steel and aluminum industries is really misguided,” said Dan North, chief economist at Euler Hermes North America. “This will lead to a decline in overall economic activity.” The roughly 150,000 jobs that could potentially be saved in those industries is dwarfed by the nearly 2 million jobs at risk in industries that use imported steel and aluminum, North said. “Those expenses will not only destroy jobs, but flow through to consumers.” "This is dumb," Sen. Ben Sasse, R-Neb, said in a statement. “Europe, Canada and Mexico are not China, and you don’t treat allies the same way you treat opponents. We’ve been down this road before — blanket protectionism is a big part of why America had a Great Depression. 'Make America Great Again' shouldn’t mean 'Make America 1929 Again.'"<doc-sep>
Send this page to someone via email The United States’ decision that Canada will no longer be exempt from its steel and aluminum tariffs is “totally unacceptable,” Prime Minister Justin Trudeau said Thursday. At a press conference in Ottawa, Trudeau and Foreign Affairs Minister Chrystia Freeland, outlined that Canada will impose a range of retaliatory tariffs that will remain in place as long as the U.S. upholds its decision. READ MORE: From pork to jeans — countries threaten tariff retaliation for U.S. steel, aluminum duties “Americans remain our partners, our allies and our friends,” Trudeau said. “This is not about the American people. We have to believe that at some point common sense will prevail, but we see no sign of that with this action today by the U.S. administration.” LISTEN BELOW: Export Development Canada economist Peter Hall speaks with 630 CHED’s Ryan Jespersen Canada, Mexico and the European Union were exempted from import duties of 25 per cent on steel and 10 per cent on aluminum when the tariffs were first imposed in March, but those exemptions were set to expire Friday. Story continues below advertisement WATCH: U.S. President Donald Trump to impose steel, aluminum tariffs 0:28 Trump to impose steel, aluminum tariffs by midnight Trump to impose steel, aluminum tariffs by midnight – May 31, 2018 The tariffs will kick in at midnight, U.S. Secretary of Commerce Wilbur Ross told reporters Thursday, adding there will be some flexibility and continued negotiations. “We look forward to continued negotiations, both with Canada and Mexico on the one hand and with the European Commission on the other hand, because there are other issues that we also need to get resolved,” he said. READ MORE: Canada retaliates against U.S. steel, aluminum tariffs, announces dollar-for-dollar ‘countermeasures’ He said Canada and Mexico had originally been exempted from the tariffs as North American Free Trade Agreement negotiations took place, but talks are “taking longer than we had hoped.” “There is no longer a very precise date they may be concluded, therefore they’re added into the list of those who will bear tariffs,” the official said. Story continues below advertisement U.S. President Donald Trump had imposed the tariffs earlier this year, saying his country had been treated “badly” in trade relations. At the time, Trump also cited national security reasons for the tariffs. LISTEN: Expert discusses message being sent by the U.S. steel and aluminum tariffs Reaction to the announcement Officials from several countries spoke out about the U.S. tariffs just after Ross made the announcement. The European Union said it has no choice but to defend itself and its industries following the move, while a spokesperson said the U.K. government was “deeply disappointed.” “The UK and other European Union countries are close allies of the U.S. and should be permanently and fully exempted from the American measures on steel and aluminium,” the U.K. statement read. Story continues below advertisement The EU and Mexico have also laid out retaliatory tariffs against the U.S. Watch below: With the U.S. imposing tariffs on Canadian steel and aluminium, there are fears of an all-out trade war breaking out between the two countries. Tom Vernon looks at what impact that could have on Alberta. 1:47 A look at how the U.S.-Canada trade dispute could impact Alberta A look at how the U.S.-Canada trade dispute could impact Alberta – May 31, 2018 — With files from The Canadian Press, Reuters and Global News reporter Amanda Connolly