June 29, 2018 – Ottawa, Ontario – Global Affairs Canada
Canada’s steel and aluminum industries have made North American steel and aluminum more competitive around the world. It is inconceivable and completely unacceptable to view any trade with Canada as a national security threat to the United States.
The U.S. has a US $2 billion annual trade surplus on iron and steel products with Canada. Canada buys more American steel than any other country in the world, accounting for 50 per cent of U.S. exports. Canadian steel is used in American tanks, and Canadian aluminum in American planes. Indeed, Canada is recognized in U.S. law as part of the U.S. National Technology and Industrial Base related to National Defence.
Today the Government of Canada announced that in direct, measured and proportional response to U.S. tariffs on Canadian steel and aluminum, reciprocal surtaxes on $16.6 billion of imports of steel, aluminum and other products from the United States will come into effect July 1, 2018.
Canada continues to work towards full and permanent removal of these unjustified and illegal U.S. tariffs.
In addition, the Government of Canada will make available up to $2 billion to defend and protect the interests of Canadian workers and businesses in the steel, aluminum and manufacturing industries. This includes a comprehensive set of measures:
- Extending the duration of work-sharing agreements by 38 additional weeks under the Employment Insurance program to help employers retain their skilled workforce and avoid layoffs during challenging times.
- Increasing funding to the provinces and territories to increase the capacity of the job and training programs available to workers affected by the U.S. measures.
- Providing liquidity support to affected businesses.
- Offering up to $250 million in new support through the Strategic Innovation Fund to help bolster the competitiveness of Canadian manufacturers and better integrate the Canadian supply chain of steel and aluminum.
- The Government of Canada will invest $50 million over five years to help Canadian companies diversify their exports to take advantage of new trade agreements, such as CETA and CPTPP. Working in partnership with business associations, this will include new “export readiness” grants.
We continue to monitor the trade situation closely. Canada has already taken steps to address diversion and dumping into the Canadian market and will work with all affected stakeholders on next steps to protect our workers and companies. We know there is a risk that imports will continue to increase, harming Canadian steel producers. This is unacceptable. In particular, in the case of energy tubular, steel plates and rebar products, we will work with stakeholders in the coming weeks on an appropriate response, including safeguards.
“Canada has always been a safe, secure and reliable source of steel and aluminum for the U.S. market. The tariffs introduced by the United States on Canadian steel and aluminum are protectionist and illegal under WTO and NAFTA rules – the very rules that the United States helped to write. It is with regret that we take these countermeasures, but the U.S. tariffs leave Canada no choice but to defend our industries, our workers and our communities, and we will remain firm in doing so. The real solution to this unfortunate and unprecedented dispute is for the United States to rescind its tariffs on our steel and aluminum.”
– Hon. Chrystia Freeland, P.C., M.P., Minister of Foreign Affairs
“The Government of Canada supports our country’s steel and aluminum workers and their families. We’re taking strong responsive measures to defend them. That includes new extended work-sharing, to help employers avoid layoffs, and increased capacity for job and skills training programs for any workers who need them.”
– Hon. Patty Hajdu, Minister of Employment, Workforce Development and Labour
“The measures announced today will help strengthen the competitiveness of Canada’s steel and aluminum companies and contribute to economic growth while increasing the capacity of the industries to innovate, grow value added, support product and market diversification, and create and sustain jobs for Canadians.”
– Hon. Navdeep Bains, P.C., M.P., Minister of Innovation, Science and Economic Development
“Canada’s aluminum and steel industries are vital to our economic prosperity and support well-paying middle class jobs. Our government stands shoulder-to-shoulder with our workers and the innovative, world-class products they produce. Working in partnership with industry and business associations, we will provide capacity support to assist Canadian companies tap into the new markets now uniquely open to them in Europe, Asia and around the world.”
– Hon. François-Philippe Champagne, Minister of International Trade
- In 2017, the Canadian steel industry employed more than 23,000 Canadians and contributed $4.2 billion to Canada’s gross domestic product (GDP).
- The Canadian aluminum industry employed 10,500 workers while contributing $4.7 billion to Canada’s GDP.
- Canada buys more American steel than any other country in the world, accounting for 50% of U.S. exports. In 2017, about US$14 billion of steel was traded between Canada and the United States.
- On aluminum, Canada and the U.S. share a highly integrated market with combined trade of more than US$11.4 billion annually.
- About 84% of Canada’s primary aluminum production is exported to the United States, where it is used as an important input for further processing into products for U.S. domestic and export markets.
- The Government of Canada has invested $50 million over five years to help Canadian companies diversify their exports to take advantage of new trade agreements, such as CETA and the CPTPP.