Canada will retaliate against imports originating in the United States for $ 2.7 billion in response to the reinstatement of 10% tariffs on Canadian aluminum purchases.

This case comes after the president, Donald Trump, had previously imposed tariffs on US purchases of steel and aluminum against several countries, including Mexico and Canada, and then eliminated those taxes on his two neighbors in the framework of the negotiations. of the Treaty between Mexico, the United States and Canada (USMCA), which entered into force on July 1.

On May 17, 2019, the United States announced an agreement with Canada and Mexico to eliminate tariffs on steel and aluminum imports originating from its two neighbors that it had previously imposed on June 1, 2018, as well as to eliminate all tariffs of retaliation imposed on US products by Canada and Mexico.

The agreement provides for aggressive control and a mechanism to avoid surges in imports to the United States of both metals.

If there are sudden increases in imports of specific steel and aluminum products, the United States may reimpose tariffs on those goods. Any retaliation by Canada and Mexico would be limited to steel and aluminum products.

«For every dollar imposed by the United States on Canadian imports, we will impose an equivalent tax in return,» said Deputy Prime Minister Chrystia Freeland on Friday.

Imports

Canada is the largest source of US foreign purchases of unalloyed raw aluminum, accounting for almost two-thirds of total imports of these items from all countries in 2019 and approximately 75% of total externas purchases in the first five months of 2020.

According to the US government, the sudden increase in imports of these items from Canada coincides with a decline in foreign purchases of these same goods from other countries and threatens to damage domestic aluminum production and capacity utilization.

Freeland called Trump’s decision «absurd» and announced that Prime Minister Justin Trudeau will open for a month «a period of consultation on a long detailed list of products containing aluminum.»

The tariffs on Canadian aluminum will take effect on August 16.