Canada well prepared to counter U.S. tariffs
Hamilton (ON), Jul 2 (IBNS): Canada is in the midst of a counter-strike with the United States after the latter's imposition of duties of 25 percent on Canadian steel and 10 percent on aluminum, came into effect on July 1, media reports said.
Canada confirmed that $16.6-billion worth of American goods will be hit with retaliatory tariffs on Canada Day.
In the midst of this, Canada pledged up to $2 billion in financial support for the steel and aluminum sectors in Canada.
Canada's Foreign Minister Chrystia Freeland was optimistic that Canada’s dollar-for-dollar response would not prompt further tariffs from the U.S.
“Canada’s approach is and will be this: we will not escalate and we will not back down,” Freeland told reporters, and added that the Canadian tariffs were permitted under World Trade Organization (WTO) rules.
In addition to steel and aluminum products, other items which could be affected included goods such as ketchup, orange juice, playing cards and pens.
But Trump suggested that he could impose tariffs of up to 25 percent if auto imports pose a national security threat.
Freeland said U.S. tariff on autos was not justified, and added that Canada was prepared for all possible outcomes and that she was in frequent contact with U.S. officials.
“I’ve expressed our willingness to return anytime, anywhere to discuss this issue,” Freeland said.
Canadian government's pledge $2-billion aid package would reportedly be complemented by $1.7 billion loans and services to assist the aluminum and steel sectors, including small- and medium-size business affected by the U.S. tariffs and to provide potential safeguards to protect the Canadian market.
Liquidity support to affected businesses in provinces and territories would also be provided by Canada to increase jobs and training funds for workers.
Strategic Innovation Fund would be giving $250 million to boost Canadian manufacturers and better integrate aluminum and steel supply chains.
Another $50 million over five years had been pledged by Canada to help companies take better advantage of the new free trade agreement with Europe and the Trans-Pacific Partnership.
With uncertainty of North American Free Trade Agreement (NAFTA) negotiations, Marvin Ryder, a business professor at McMaster University in Hamilton, said Ottawa “had to do something active to assist companies and workers caught in the crossfire of the trade dispute...This is something Canadian companies have needed to do for a long time.”
(Reporting by Asha Bajaj)
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