Reject a Chinese takeover of a construction company shunning closer ties with China. Canadians give themselves some self-congratulatory praise and a pat on the back.

What's next? Why ... lets go fight a trade war with the Americans!!!

Kind of dumb eh? That's Canada!

Canada to retaliate with dollar-for-dollar tariffs against U.S. products

Steven Chase
Adrian Morrow
Greg Keenan Auto and Steel and Airline Industry Reporter
Washington
Published May 31, 2018
Updated May 31, 2018

Canada is retaliating “dollar-for-dollar” against the United States for punitive action against Canadian steel and aluminum producers, Prime Minister Justin Trudeau announced, saying Ottawa plans to slap levies against $16.6-billion of American imports on July 1.

The proposed target list of American products will include U.S. steel and aluminum as well a slew of goods including sailboats, whisky, plywood, refrigerators, washing machines and herbicides.

U.S. tariffs of 25 per cent on Canadian steel and 10 per cent on Canadian aluminum take effect Friday morning after the Trump administration removed an exemption sparing Canada and the European Union from these measures first announced earlier this year.

Mr. Trump justified these measures by claiming they were necessary to ensure American “national security” because they would expand the U.S. capacity to construct its own tanks and warships.

Foreign Affairs Minister Chrystia Freeland called this rationale “absurd” and “specious” and Mr. Trudeau suggested the Trump administration’s actions amount to a betrayal of the longstanding military and business relationship between two neighbours.

“That Canada could be considered a national security threat to the United States is inconceivable,” the Prime Minister said he announced the countermeasures. “For 150 years, Canada has been America’s most steadfast ally. Canadians have served alongside Americans in two world wars and in Korea,” he said.

“From the beaches of Normandy to the mountains of Afghanistan, we have fought and died together,” he said. “We came to America’s aid after 9/11 – as Americans have come to our aid in the past.

“We are fighting together against Daesh in Northern Iraq.”

The Canadian government did not immediately explain what it will do with the revenue it collects from the hefty tariffs or whether it will distribute some of the money to the Canadian steel and aluminum industry.

“Today we sent a clear message that we stand with Canadians, and we are prepared to take action to defend jobs,” Daniel Lauzon, a spokesman for Finance Minister Bill Morneau said.

“We won’t speculate on future actions or potential revenue, but one things is certain: we stand by Canadian workers and our industries.”

U.S. Secretary of Commerce Wilbur Ross cited a lack of progress in the renegotiations of the North American free-trade agreement as a reason for President Donald Trump eliminating an exemption Canada was given when worldwide tariffs were announced earlier this year. “The talks are taking longer than we had hoped. There is no longer a very precise date as to when they will be concluded.”

The U.S. move is the latest trade attack on Canada from its largest trading partner: Mr. Trump has accused the country of “taking advantage” of the United States under NAFTA and wants the pact overhauled. And last week, he ordered an investigation into auto imports to the United States that could lead to 25-per-cent tariffs on cars and trucks, which would disproportionately hit Canada; about 80 per cent of Canadian-made vehicles are for the U.S. market.

“I would like to absolutely assure Canadians, particularly those who work in the steel and aluminium industries, that the government is absolutely prepared to and will defend Canadian industries and Canadian jobs,” Foreign Minister Chrystia Freeland said earlier on Wednesday. “We will respond. And we will respond appropriately.”

Mr. Trump brought in tariffs on all steel and aluminum imports earlier this year, claiming they were necessary to ensure “national security” by building U.S. capacity to construct its own tanks and warships. The President granted temporary exemptions to a handful of countries, giving them time to negotiate permanent exclusions in exchange for accepting restrictions on how much of the metals they could sell to the United States.

The tariff exemptions for Canada, Mexico and the EU expire on Friday.

The Trump administration used the threat of tariffs in NAFTA talks, saying Canada and Mexico would receive a permanent pass only as part of a renegotiated deal. NAFTA negotiations are deadlocked over tough protectionist demands from the United States.

Canada and Mexico have proposed NAFTA deals over the past month, said sources with knowledge of the closed-door talks – offering to agree to U.S. demands on content rules in the auto sector if the Trump administration drops its other proposals. The United States rejected the offers.

On Tuesday, Ms. Freeland met with Mr. Trump’s trade chief, Robert Lighthizer, in Washington for two hours in an effort to get a permanent exemption on tariffs. She spoke with him again later by telephone, but left the U.S. capital on Wednesday morning empty-handed.

Negotiations on a further exemption for Canada had focused on agreeing to U.S. demands that NAFTA force auto makers to use more North American-made steel, the sources said. The Americans also pressed for a quota on the amount of steel and aluminium Canada could ship to the United States.

One source close to the NAFTA negotiations said Ms. Freeland informed Mr. Lighthizer that ending Canada’s exemption on steel and aluminum tariffs would be a clear signal that the Americans are not that interested in reaching a NAFTA deal.

Flavio Volpe, president of the Automotive Parts Manufacturers’ Association of Canada, echoed Ms. Freeland.

“It makes it really difficult to believe that deliberations are in good faith if you’re taking capricious actions like this that really hurt the other parties,” he said. “How do you sit at the centre of the global economy and behave this way?”

Prime Minister Justin Trudeau lobbied Mr. Trump directly by telephone last week, and contacted Vice-President Mike Pence on Tuesday.