Canada Strikes Back at Trump: $12 Billion of Tariffs Come Into Force

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Justin Trudeau's government finalized tariffs on C$16.6 billion ($12.6 billion) of American goods and pledged money to support companies and workers hurt by us levies on Canadian steel and aluminum exports.

Aside from tariffs on steel and aluminum imports from the USA, dozens of additional consumer goods will be subject to 10 per cent duties - from ketchup, to lawn mowers, to playing cards.

It reached new depths at the recent G7 summit when Trump abruptly rejected the joint statement and insulted his Canadian host, Prime Minister Justin Trudeau.

Chrystia Freeland, Canada's Minister of Foreign Affairs, speaks during her visit to Stelco in Hamilton, Ontario, Friday, June 29, 2018.

On Friday, Ottawa unveiled plans to impose approximately $12.6 billion worth of tariffs on USA goods from July 1, following the example of other major US allies.

President Trump's tariffs on Canadian products and attacks against Prime Minister Justin Trudeau have prompted the mayor of Ottawa, the country's capital and fourth-largest city, to skip an invite-only Fourth of July party being held at the US ambassador's residence next week. Starting on July 1 most of the items will be taxed at rates of 10 percent or 25 percent.

Axios news agency reported on Friday that Trump had repeatedly told top White House officials he wants to exit the WTO, citing unidentified sources.

In addition to Canada, the European Union and Mexico are among those that have announced tariffs on U.S. goods in response.

"The two leaders agreed to stay in close touch on a way forward", it said. The Canadian government, alongside the European Union and Mexico, has formally challenged the American tariffs at the World Trade Organization.

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In announcing which USA products would be slapped with either a 25 per cent or 10 per cent surtax, Foreign Affairs Minister Chrystia Freeland asserted that Canada "will not back down". It's not known how much of that money will come to Alberta (our steel exports to the United States are worth about $500 million compared to about $7 billion for all of Canada).

The tit-for-tat duties follow punishing United States steel and aluminum tariffs imposed at the start of June. "This is a perfectly reciprocal action. Unions welcome the Canadian government's rapid response in defense of Canadian workers as an important first step in protecting workers and communities who will be adversely affected by this misguided attack on Canadian industry", said CLC President Hassan Yussuff. Freeland said such tariffs would be "absurd" because the North American auto industry is highly integrated and parts made in Canada often go to cars manufactured in the USA and then sold back to Canadians.

Freeland said she expected the negotiations would enter an intensive phase after a Mexican presidential election on July 1.

She also repeated that Mr Trump's decision to invoke national security to justify the U.S. tariffs on steel and aluminium imports was "insulting" to Canadian veterans who had stood by their USA allies in conflicts dating back to World War I.

The Trump administration in May launched an investigation into whether imported vehicles posed a national security threat.

Canada will also spend $50 million over five years to help companies diversify exports and take better advantage of the new free trade agreement with Europe and the Trans-Pacific Partnership.

Instead, Canada is trying to make political life uncomfortable for Trump through the retaliatory tariffs that cover an eclectic mix of products, literally from soup to nuts (of the metal kind).

Canadians are particularly anxious about auto tariffs because the industry is critical to Canada's economy.

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