Steel and aluminum tariffs: Canada would be a winner
According to Clément Gignac, chief economist and vice-president of iA Financial Group (Industrial Alliance), trade tensions with China have pushed Americans to soften the tone with their Canadian, Mexican and European trading partners.
“I find it interesting to see that the US Treasury Secretary (Steven Mnuchin) announces that an agreement in principle is imminent to lower steel and aluminum tariffs with Canada and Mexico, and that the same day, the US administration announces a postponement of at least six months before deciding whether it will impose tariffs in Europe. Mr. Trump and his administration, who seem to be attacking everyone, are beginning to realize that they can not wage a trade war against China and upset Canadians, Mexicans and Europeans, “said the former Minister, on the sidelines of a conference held at the annual meeting of the Forest Industry Council (CIFQ), Wednesday, in Quebec City.
These announcements could even be a sign that the conflict with China could be longer than expected, the latter adds.
An influential member of the Trump administration, Steven Mnuchin predicted on Friday the final removal of the 25 percent duty on steel and 10 percent on aluminum, while he testified before the credit sub-committee. of the US Senate.
On Wednesday, Canadian Foreign Minister Chrystia Freeland was in Washington to meet with Trade Representative Robert Lighthizer in a new attempt to lift these punitive tariffs.
“We have argued, as we have been doing for some time, that the best outcome for Canadians and Americans would be to lift these tariffs and allow free trade between our two countries,” said Ms. Freeland, who said then met the influential chairman of the Senate Finance Committee, Republican Chuck Grassley.
According to Clément Gignac, if the end of tariffs materializes, Canada and Mexico could then ratify the Canada-United States-Mexico Agreement (CETA), the free trade agreement that would replace NAFTA.
In the United States, however, the signing of the deal should be more complicated, says John Parisella, an expert on American politics and special advisor at National, because it is the Congress, dominated by the Democrats, which will have to ratify the agreement. “Trump will say, ” I negotiated, I got concessions and I got an agreement; now it’s up to you to do the work, ‘says John Parisella, who was also present at the CIFQ conference.
According to Clément Gignac, the trade war with China, which extends to the fields of technology and national security, announces a repositioning of global supply.
“Clearly, the global supply chain will change,” said the man on the Conference of Business Economics, a select group of 35 world economists – of which he is the only Canadian – who meets three times a year in Washington. We are going to a continental supply chain. And for Canada, it can be an advantage. ”
For example, a US supply chain could solve the ongoing softwood lumber conflict, he added. “If we strengthen our ties in North America with this agreement, that we remove tariffs on steel and aluminum, why would lumber be treated differently? He asked. with the Canadian Press