11 Feb 2019
Pressure Mounts to Eliminate Steel and Aluminium Tariffs to Secure USMCA Approval
The Trump administration is coming under increasing pressure to eliminate its Section 232 tariffs on imports of steel and aluminium products from Canada and Mexico in order to secure approval of the U.S.-Mexico-Canada Trade Agreement.
In a recent letter to U.S Commerce Secretary Ross and U.S. Trade Representative Lighthizer, a number of U.S. trade associations urged the removal of the Section 232 tariffs as well as the retaliatory duties that have been imposed by Mexico and Canada, stating that the damage they are causing “far outweighs any benefit that may accrue” to U.S. manufacturers, farmers and ranchers from the USMCA. The letter called on the officials to “take all necessary steps to resolve this matter so that zero-tariff North American trade can resume, and we can turn our attention to working with you to gain prompt Congressional approval of the USMCA.” House Ways and Means Committee Ranking Member Kevin Brady (Republican-Texas) reportedly added that Congress is “not really willing to consider this agreement until the steel and aluminum tariffs are assured of being lifted off.”
The White House is seeing pressure from its trade partners as well. Canadian Foreign Affairs Minister Chrystia Freeland said during a recent visit to Washington to discuss the USMCA with U.S. lawmakers that the continued imposition of the “absurd” and “illegal” tariffs on steel and aluminium from Canada is a hurdle to implementing the agreement. Earlier in the week ministers from Ontario and Quebec urged the Canadian federal government to press the U.S. harder to remove the tariffs, which they said are harming Canadian workers and industry. There have been some calls for Canada to lift its retaliatory tariffs as an enticement for the U.S. to eliminate its tariffs, but Freeland indicated that Ottawa is unlikely to do so.