Already under fire for his combative trade policies, President Donald Trump on Friday intensified pressure on Canada, demanding that America’s neighbor and close ally “open their markets and take down trade barriers.”
Trump’s tweet came a day after he ignited global condemnation by imposing tariffs on steel and aluminum imports from Canada and two other key U.S. allies — the European Union and Mexico.
The United States had sought use the tariff threat as cudgel to win concessions from Canada and Mexico in talks to renegotiate the North American Free Trade Agreement. But the NAFTA talks sputtered anyway, and the Trump administration imposed the tariffs at midnight Thursday.
The president took to Twitter Friday to accuse Canada of treating U.S. “farmers very poorly for a long period of time.” And he repeated his inaccurate claim that Canada runs a trade surplus with the United States. In fact, U.S. Commerce Department numbers show, the United States recorded a trade surplus with Canada for each of the past three years.
Trump’s antagonistic trade policies — and specifically the steel and aluminum tariffs — drew international denunciation. French President Emmanuel Macron said Friday that he told Trump in a phone call that the new U.S. tariffs on European, Mexican and Canadian goods were illegal and a “mistake.”
And Macron pledged the retaliation would be “firm” and “proportionate” and in line with World Trade Organization rules.
Germany’s Volkswagen, Europe’s largest automaker, warned that the decision could start a trade war that no side would win.
The European Union and China said they will deepen ties on trade and investment as a result.
“This is stupid — it’s counterproductive,” Francis Maude, a former British trade minister, told the BBC. “Any government that embarks on a protectionist path inflicts the most damage on itself.”
Trump’s move makes good on his campaign vows to crack down on trading partners that he claims exploit poorly negotiated trade agreements to run up big trade surpluses with the United States.
The tariffs his administration has imposed — 25 percent on imported steel, 10 percent on aluminum from Canada, Mexico and the European Union — threaten to drive up prices for American consumers and companies and heighten uncertainty for businesses and investors around the globe.
Mexico complained that the tariffs will “distort international trade” and said it will penalize U.S. imports including pork, apples, grapes, cheeses and flat steel.
In Canada, Prime Minister Justin Trudeau said the tariffs were “totally unacceptable,” and Canada announced plans to slap tariffs on $12.8 billion worth of U.S. products, ranging from steel to yogurt and toilet paper.
“Canada is a secure supplier of aluminum and steel to the U.S. defense industry, putting aluminum in American planes and steel in American tanks,” Trudeau said. “That Canada could be considered a national security threat to the United States is inconceivable.”
Trump had originally imposed the tariffs in March, saying a reliance on imported metals threatened national security. But he exempted Canada, Mexico and the European Union to buy time for negotiations — a reprieve that expired at midnight Thursday.
Other countries, including Japan, America’s closest ally in Asia, are already paying the tariffs.
“This is protectionism, pure and simple,” said Jean-Claude Juncker, president of the European Commission.
The EU earlier threatened to counterpunch by targeting U.S. products, including Kentucky bourbon, blue jeans and motorcycles. David O’Sullivan, the EU’s ambassador in Washington, said the retaliation will probably be announced in late June.
Trump had campaigned for president on a promise to crack down on trading partners that he said exploited poorly negotiated trade agreements to run up big trade surpluses with the U.S.
The U.S. tariffs coincide with — and could complicate — the Trump administration’s separate fight over Beijing’s strong-arm tactics to overtake U.S. technological supremacy. U.S. Commerce Secretary Wilbur Ross is leaving Friday for Beijing for talks aimed at preventing a trade war with China.
The world’s two biggest economies have threatened to impose tariffs on up to $200 billion worth of each other’s products.
The steel and aluminum tariffs could also complicate the administration’s efforts to renegotiate NAFTA, a pact that Trump has condemned as a job-killing “disaster.”
The White House released a statement from Trump Thursday night saying of NAFTA, “Earlier today, this message was conveyed to Prime Minister Justin Trudeau of Canada: The United State (sic) will agree to a fair deal, or there will be no deal at all.”
Trump had offered the two U.S. neighbors a permanent exemption from the steel and aluminum tariffs if they agreed to U.S. demands on NAFTA. But Ross said there was “no longer a very precise date when they may be concluded,” and that as a result, Canada and Mexico were added to the list of countries hit with tariffs.
Likewise, the Trump trade team sought to use the tariff threat to pressure Europe into reducing barriers to U.S. products. But the two sides could not reach an agreement.
The import duties will give a boost to American makers of steel and aluminum by making foreign metals more expensive. But companies in the U.S. that use imported steel will face higher costs.
And the tariffs will allow domestic steel and aluminum producers to raise prices, squeezing companies — from automakers to can producers — that buy those metals.