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Canada hits back at US with $12.6 billion in retaliatory tariffs

30 June 2018

Woodbridge says he heard about the possibility of retaliatory tariffs on the television news shortly after President Trump imposed tariffs on Canadian steel and aluminum, citing us national security concerns.

Prime Minister Justin Trudeau's government released the final list of items that will be targeted beginning July 1.

Trump has justified the steel and aluminium tariffs by saying imported metals threaten USA national security - a justification that countries rarely use because it can be so easily abused.

Canada has been pursuing trade deals with other nations, and is staying well connected with political and business networks in the U.S. Paul Moen, an global trade lawyer at Earnscliffe Strategy Group in Ottawa, says the Canadian government has also promised to step in to help industries like dairy and steel.

Freeland has long insisted that Canada introduced stronger safeguards on steel well before the USA imposed the tariffs.

A month later the trade turmoil continues, however, with Trump and his officials taking aim at Trudeau personally, as well as other Canadian industries over what the US president calls unfair trade practices. It is with regret that we take these countermeasures, but the USA tariffs leave Canada no choice but to defend our industries, our workers and our communities, and we will remain firm in doing so.

"We will not back down", she told the audience of steelworkers and officials.

"This is a perfectly reciprocal action", Freeland said.

Last week, U.S. Commerce Secretary Wilbur Ross said the U.S. tariffs against Canada and other allies were created to force them into action to address the world's overproduction and overcapacity of steel.

In addition to providing financial support, the government will continue to study whether potential safeguards are necessary to protect the Canadian market, said Economic Development Minister Navdeep Bains, who was also in Hamilton for the tariff announcement. "Having said that our approach from day one of the NAFTA negotiations has been to hope for the best but prepare for the worst".

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Canada places tariffs on dairy, egg and poultry imports above a set limit as part of its supply management system.

The official list, by the way, is entitled "Countermeasures in Response to Unjustified Tariffs on Canadian Steel and Aluminum Products".

Senior officials from Canada are lobbying the Big Three U.S. vehicle makers to stave off the punitive measures and say they are considering all options, including providing financial aid. At the time, he lamented what he framed as a necessity to strike back at Canada's largest trading partner, and called the US tariffs "an affront" to a country whose soldiers have fought and died alongside Americans.

Ottawa also unveiled 2 billion dollars ($ 1.5 billion) in aid for the two sectors. "We just can't accept that that behavior, the bullying, from somebody that is going to affect our country, our jobs, our families' livelihoods on a whim", he says.

But relations between these two neighbors have plunged to their lowest in decades, reaching new depths at the recent Group of Seven summit when Trump abruptly rejected the joint statement and insulted Trudeau.

Canada announced that it would be imposing tariffs on more than $12 billion American products.

Ottawa had been consulting on the proposed list of goods to mitigate any unintended consequences for Canadian businesses, though it is anticipated the tariffs and counter-tariffs will cost consumers on both sides of the border.

Canadian Foreign Minister Chrystia Freeland gestures during a joint news conference on the closing of the seventh round of NAFTA talks in Mexico City, Mexico, March 5, 2018.

Overall, Ujczo said Canada's retaliatory tariffs have been baked into the White House's calculus for months.

Bains, the economic development minister, said the support is aimed at helping firms adjust to the hard circumstances while enabling them to continue to innovate along the way.

Canada hits back at US with $12.6 billion in retaliatory tariffs