Canada’s Prime Minister Responds to U.S. Tariff Increases

In a significant escalation of trade tensions, Canadian Prime Minister Mark Carney has criticized U.S. President Donald Trump’s decision to double tariffs on steel and aluminum to 50%. This move raises concerns not just for Canada, which is the largest foreign supplier of these metals to the U.S., but for American workers and industries as well.

Addressing the media in Ottawa, Carney stated, “The latest tariffs on steel and aluminum are unjustified, they’re illegal, they’re bad for American workers, bad for American industry and of course for Canadian industry as well.” He assured that Canada would take a measured approach to crafting a response, saying, “It will take some time, not much.”

In parallel, the Prime Minister emphasized the importance of “intensive discussions” taking place with the U.S. administration aimed at redefining Canada-U.S. trade relations. Highlighting a recent agreement with U.S. Commerce Secretary Howard Lutnick, Carney noted that this followed Ontario Premier Doug Ford’s decision to suspend a 25% surcharge on outsourced electricity to three American states.

Carney further declared, “We can’t sit back and let President Trump steamroll us,” pointing out that “everything’s on the table” regarding retaliatory measures. In the previous year, Canada exported an impressive 5.95 million tonnes of steel and 3.15 million tonnes of aluminum to the United States, marking a significant aspect of the trade relationship.

Meanwhile, trade discussions between the European Union (EU) and the United States are reportedly making headway according to key negotiators. However, the EU has expressed that the doubled U.S. tariffs negatively impact the ongoing negotiations.

President Trump’s tariff hike—rising from 25% to 50% on steel and aluminum imports—coincided with a call for trading partners to present “best offers” to avoid further punitive measures slated for early July.

In a related development affecting global trade dynamics, heightened concerns about China’s restrictions on vital mineral exports have emerged. These restrictions have led some European auto parts manufacturers to suspend operations, with German automotive giant BMW expressing that its supplier network is experiencing significant disruptions.

This backdrop of rising tariffs extends beyond North American borders. EU negotiator Maroš Šefčovič characterized recent meetings with U.S. Trade Representative Jamieson Greer in Paris as constructive. “We both concluded that we are advancing in the right direction, at pace,” he conveyed, adding that technical discussions are ongoing in Washington and high-level engagements will follow. “What makes me optimistic is I see the progress…the discussions are now very concrete,” he remarked.

Greer echoed this sentiment, stating that the meetings demonstrated “a willingness by the EU to work with us to find a concrete way forward to achieve reciprocal trade.” Šefčovič lamented the tariff increase, stating that the EU faces similar challenges with overcapacity in the steel sector and should collaborate with the U.S. to address these issues.

On the international front, President Trump referred to Chinese President Xi Jinping as “very tough, and extremely hard to make a deal with.” This statement comes amid allegations of China violating a previous agreement regarding tariff rollbacks and as expectations rise for an upcoming discussion between the two leaders.

Recently, a U.S. trade court ruled that President Trump had exceeded his authority in imposing several tariffs under an emergency powers act, yet an appeals court swiftly reinstated these levies as it reviews the government’s appeal.

Despite talks with various nations following Trump’s announced pause on tariff increases in April, only one agreement with the United Kingdom has materialized, and even that is merely a preliminary framework. British Prime Minister Keir Starmer expressed optimism that U.S. tariffs on U.K. steel could soon be eliminated.

Pressure is mounting globally, as the Organisation for Economic Cooperation and Development (OECD)—a coalition of 38 developed nations—has revised its global growth forecasts downward due to the impact of these tariffs. Chief Economist Alvaro Pereira commented that “Trade, consumption, and investment have been affected by the tariffs,” stressing that the U.S. economy will bear the heaviest consequences.

In Mexico, Economy Minister Marcelo Ebrard announced plans to seek an exemption from the heightened tariffs, reasoning that it’s unjust to impose tariffs on a product where the U.S. has a surplus in trade with Mexico. “It makes no sense to put a tariff on a product in which you have a surplus,” he asserted.

Globally, the uncertainty surrounding U.S. trade policy is wreaking havoc for businesses. French spirits company Remy Cointreau has abandoned its 2030 sales growth targets, attributing this decision to tariffs, sluggish U.S. sales, and an unpredictable market landscape. Similarly, Austrian specialty steelmaker Voestalpine warned that these levies could negatively impact its earnings.

As German steel and metal processing associations voice their concerns, WSM Managing Director Christian Vietmeyer highlighted the significant challenges businesses face, stating, “Nobody has the margins to absorb these bottomless tariffs.” He emphasized the need for the EU to take every possible action to resolve this customs conflict.

As trade dynamics continue to evolve, the focus remains on how countries can navigate these challenges together for mutual benefit.

Edited By Ali Musa
Axadle Times International – Monitoring