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Canada retaliates with dollar-for-dollar counter tariffs on U.S. products
OTTAWA — The federal government announced it will match tariffs dollar for dollar on U.S. products on Tuesday, marking a tit-for-tat escalation in the trade conflict with Canada’s largest trading partner.
Canada will impose 15, 25, and 50 per cent tariffs on products drawn from those targeted by U.S. Section 338 and Section 232 tariffs, effective Sept. 8. The counter-tariffs are expected to cover $27.6 billion worth of imports from the U.S.
The matching on Section 232 tariffs also means Canadian tariffs on U.S. steel and aluminum will increase from 25 to 50 per cent.
The counter-tariffs are in response to the latest round of U.S. levies under Section 338 of the Trade Act of 1930, that came into effect on Saturday following the suspension of trade talks between Canada and the U.S.
Carney said several last-minute additions to a tentative agreement made a deal with the U.S. untenable, adding that it would require a change in “attitude” on the Americans’ part to get Canada back to the negotiating table.
The Section 338 tariffs subjects $28 billion worth of Canadian goods ranging from hockey sticks to dairy products to a 50-per-cent levy.
The list of U.S. products now subject to counter-tariffs include fish, cheese, beauty products, plywood, paper products and clothing.
Speaking at a technical briefing, federal government officials said the goal of the counter-tariffs is to level the playing field for Canadian industries and businesses subject to U.S. tariffs.
On Tuesday, the federal government also announced a $7.5 billion in additional funding to help businesses and workers weather the impacts of the latest round of American levies.
This includes $1.5 billion to stand up a Regional Tariff Response Initiative for medium and small businesses under the existing Strategic Response Fund, which will be administered through the regional development agencies. An additional $500 million will be provided to the Business Development Bank of Canada to provide more interest-free loans to affected businesses, particularly in the forestry, steel and aluminum sectors.
Nearly $3.5 billion will go towards expanding employment insurance programs for workers and employers impacted by tariffs.
On Tuesday morning, Canada-U.S. Trade Minister Dominic LeBlanc said the government still wants to make a deal with the U.S.
“Our preference was to find a deal that benefits both countries, we still believe that’s possible, but in the meantime we’re not waiting by the phone. We’re going to do the work that’s necessary to protect our own economy,” said LeBlanc, on the CNBC show Squawk Box.
More to come.
National Post
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