Canada, which has fallen into a trade dispute with China and the United States, has recently "a step backwards", reducing tariffs on part of steel and aluminum products imported from China and the United States, in order to ease domestic pressure.
According to Reuters, a government document showed that the Ministry of Finance of Canada, in an amendment to the 2024 China Import Additional Tax Reduction Order, granted tariff reductions for some steel and aluminum products imported from China and not produced in Canada; while exempting some U.S. steel and aluminum products from tariffs, which are mainly related to public health, national security, manufacturing, agriculture and food.
The federal government has granted reductions to dozens of Canadian companies through a “crypt decree” so that they don’t have to pay “retaliatory tariffs” for specific products that are considered to be inadequate for supply or required under existing contracts.
In a statement, the Canadian Federal Minister of Finance said the new exemption measures aimed at helping Canadian workers and families to keep them from the damage of “contra-measures.”
Since the second half of last year, Canada has imposed tariffs on a series of steel and aluminum products exported from China and the United States. The United States is retaliation for its tariffs on Canadian steel and aluminum products, while China is considered to follow the trade measures of the United States. In addition, the government led by former Canadian Prime Minister Trudeau also imposed a 100% tariff on Chinese electric vehicles.
Canada's move quickly triggered a counterattack from China. China launched an anti-dumping investigation on Canadian imports of rapeseed. In August this year, it adopted temporary anti-dumping measures and imposed a 75.8% margin on Canadian companies. In addition, China has also imposed additional tariffs on Canadian rapeseed oil, aquatic products, and pork. This has put the Canadian government under pressure from domestic agriculture.
Recently, Canadian Prime Minister Carney sent officials to China for experimental contacts, and Foreign Minister Anand made a visit to China last week, saying it would be difficult to repair relations with China and rebuild relations with China."Canadian "Global Post" cited experts' analysis said that in order to succeed, Carney must manage to persuade China to cancel measures on Canadian oil seeds, but at this stage it is not intended to reduce restrictions on imports of Chinese electric vehicles.
Facing the United States, Canada has recently stated that it will not continue to impose more retaliatory tariffs on the United States. Carney said last week that "Canada is working to reach an agreement to get some exemptions for industries such as aluminum, steel and energy" and that "now is the time to negotiate."
Canadian Broadcasting Corporation that Cobbden, chief executive and president of the Association of Canadian Steel Producers, said: “We are disappointed to see that U.S. producers have been granted a two-month extensive tariff exemption while we are unable to access their markets.”
As the trade conflict continues, domestic pessimism over economic growth has risen in Canada. Bloomberg on 20th that more than half of Canadians said they think the economy will weaken in the next six months. Canadian policymakers said they have spoken with exporters in the steel and aluminum industries, the latter reporting “particularly weak prospects.” The companies also said that tariffs “caused a lot of job cuts.”