TRUMP LAUNCHES TRADE WAR

Canada hits back with tariffs

The far-reaching ramifications caused by heavy U.S. tariffs imposed on Canadian steel and aluminum will trickle down to everyday consumers, says the president of an Edmonton manufacturing company.

“When you walk into Home Depot and buy a piece of steel, there is a very real possibility ... (it) will be more expensive,” said AltaSteel president Jon Hobbs Thursday.

Twenty per cent of the more than 300,000 tons of steel produced each year by his company is exported across the border, he said.

“In the eyes of the U.S. customer, our product just became 25 per cent more expensive,” he said. “Our reaction was one of extreme disappointment.”

Canada, Mexico and Europe were exempt from import duties of 25 per cent on steel and 10 per cent on aluminum when they were first imposed by the Trump administration in March.

Those exemptions end at midnight Thursday.

In anticipation of the deadline, Ottawa announced retaliation measures, including a dollar-for-dollar tariff on up to $16.6 billion worth of U.S. imports.

The tariffs, which apply to a long list of U.S. products that includes everything from flat-rolled steel to playing cards and felt-tipped pens, will take effect July 1.

It’s the strongest trade action Canada has taken in a postwar era, said federal Foreign Affairs Minister Chrystia Freeland, who made the announcement alongside Prime Minister Justin Trudeau Thursday.

“This is a very strong response, it is a proportionate response, it is perfectly reciprocal,” Freeland said.

Alberta Trade Minister Deron Bilous called the U.S. move absurd and insulting.

Earlier this year, he wrote a joint letter with several U.S. states urging the White House to walk back its talks of imposing tariffs, he said.

“As Canadians we are polite and we’ll negotiate but we’re not afraid to get our elbows out,” he said, adding he’s hoping “sober second thought” prevails.

“This could very quickly escalate,” Bilous told reporters. He noted the move could raise costs of major infrastructure projects.

“We’ll work with the federal government to ensure this does not delay the construction of the Trans Mountain pipeline,” he said.

A product can go back and forth across the border three or four times before it is actually built.

About 75 per cent of the steel needed for the Trans Mountain pipeline expansion and steel needed for Keystone XL and Enbridge Line 3 has already been purchased, said a spokesman for the Economic Development and Trade Ministry Thursday.

Premier Rachel Notley said it’s also bad news for U.S. businesses.

“A product can go back and forth across the border three or four times before it is actually built,” she said at a Fort McMurray news conference. “That kind of unpredictable behaviour underlines why we cannot be attached to one market and one market only.”

Hobbs said the uncertainty over the last four months has been a “severe aggravation.

“We need an even playing field,” he said.