US reaches deal to end tariffs on steel from Canada and Mexico
The Trump Administration ends tariffs on steel and aluminum from Canada and Mexico.
The US has reached a deal with Canada to end tariffs on Canadian steel and aluminum. A similar deal with Mexico to end tariffs on Mexican metals is also imminent. US President, Donald Trump, imposed a 25% tariff on metals from the North American nations in 2018.
Why did the US lift tariffs on Canadian and Mexican steel and aluminum?
Trump wants to end the tariffs to pave the way for the US Congress to ratify the US-Mexico-Canada Agreement (USMCA). The USMCA was reached between the three countries at a G20 summit in November 2018.
Trump touted the agreement as pivotal in replacing the North American Free Trade Agreement (NAFTA) the nations reached in the 1990s.
'I’m pleased to announce we’ve just reached an agreement with Canada and Mexico and we’ll be selling our product into those countries without the imposition of tariffs, or major tariffs. Big difference. That deal is going to be a fantastic deal for our country, and hopefully [the US] Congress will approve the USMCA quickly,’ said Trump.
The US Congress was reluctant to ratify the USMCA after Trump imposed the taxes on the imported metals. With this new trade deal, Congress may be more likely to approve the agreement.
Canadian Prime Minister, Justin Trudeau, also hailed the deal as a sign of progress for trade between the US and Canada.
‘This decision reflects what is known to be true by friends on both sides of the border: Canada has been America’s most steadfast ally for more than a hundred years, and our longstanding partnership and closely linked economies make us more competitive around the world and improve our combined security,’ said Trudeau.
What is the reaction to the US ending steel tariffs on Canada and Mexico?
The American Automotive Policy Council, which represents American carmakers like Ford, praised the decision to end the steel and aluminum tariffs. Ford lost $1 billion because of the raised taxes on imported metals. The council said in a statement that it hopes the deal will help US carmakers and consumers.
‘We are reviewing the agreement to better understand it, and we are hopeful that the agreement will effectively resolve the issue between the three trade partners. Together with the new USMCA trade agreement, an accord on steel and aluminum tariffs will help ensure that US automakers will continue to be globally competitive and support American jobs and the US economy,’ said the council.
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