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U.S. and Canada agree to eliminate steel and aluminum tariffs

The U.S. and Canada have agreed to remove tariffs on each other’s steel and aluminum and all related retaliatory tariffs, eliminating a major source of friction between the two countries and a key obstacle to the ratification of a new free-trade agreement.

The tariffs will be gone within two days, according to a joint statement issued Friday afternoon.

U.S. President Donald Trump’s administration had insisted for months that the tariffs on Canada would not be lifted unless quotas were imposed in their place. Prime Minister Justin Trudeau objected, and Trump accepted an agreement that does not include quotas.

Instead, the two governments settled on a variety of other measures.

They said they would create a shared system for monitoring “surges” in trade of steel and aluminum products. If imports of a particular product are found to have surged “meaningfully beyond historic volumes of trade over a period of time,” either country can request a consultation with the other, then impose tariffs on that individual product — not the whole steel or aluminum industry at once. The other country can then impose retaliatory tariffs, but only on other products in the same industry.

They also committed to vaguer provisions aimed at keeping low-cost Chinese steel from being sent through Canada to the U.S. The provisions will “prevent the importation of steel and aluminum that is unfairly subsidized and/or sold at dumped prices,” “prevent the transshipment of steel and aluminum made outside of Canada or the United States to the other country,” and treat “steel that is melted and poured in North America separately from products that are not,” the statement said.

Trudeau described the agreement as “just pure good news for Canadians, for families, as they head into that long weekend.”

“A lot of people were talking about whether we would accept quotas, whether we would accept certain restrictions, and we stayed strong,” he said during an appearance with steelworkers in Hamilton.

The U.S. and Mexico announced Friday that they had also reached a deal.

John Stan    5/17/2019


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