Foreign Affairs Minister Chrystia Freeland gave no hint today that the United States is set to lift steel and aluminum tariffs, even though Mexico’s top trade representative is saying a deal for their country is imminent and the U.S Treasury secretary says all three countries are “close” to finding a solution to the standoff.
Speaking to reporters in Washington after meeting with U.S. Trade Representative Bob Lighthizer, Freeland said that ratification of the new NAFTA and the tariffs were discussed in the meeting. She refused to give any details
“During the NAFTA negotiations, we took the view that talking about the details of our conversations in public was counterproductive and I think that was an important confidence-building step in terms of creating a good atmosphere for the whole negotiation to move forward,” she said.
Freeland also refused to weigh in on comments by Jesús Seade, Mexico’s chief North American trade negotiator, who told CBC News Network’s Power & Politics that a deal to lift tariffs on Mexican steel was “almost done.”
“Very quickly we have made a tremendous progress and I’m looking to an early resolution on the basis of lifting the tariff, no quotas. We were getting close to an agreement,” Seade told host Vassy Kapelos.
Seade said that the only thing stopping him from signing a deal with the U.S. to lift tariffs was a desire to speak to Canada first.
Freeland said that when it comes to Mexico and the U.S. striking a deal on tariffs without Canada, she would “leave it to the Mexicans and the Americans to comment.”
Last June, the U.S. Department of Commerce slapped tariffs of 25 per cent on imports of steel and 10 per cent on aluminum, citing national security interests. Canada, Mexico and a number of other countries were affected.
Canada retaliated with its own tariffs of 25 per cent on steel and 10 per cent on aluminum, but also imposed a 10 per cent tariff on multiple consumer items, targeting U.S. politicians in states where those products are made.
Pushing back against quotas
That product list included Kentucky bourbon, lawn mowers, ketchup, maple syrup, appliances, boats and many other items. The federal government said it was targeting goods that Canadians could otherwise buy from domestic suppliers.
Since then, the Liberal government has rolled back some of the retaliatory tariffs, including ones imposed on recreational boats, while others remain in place.
As long as the tariffs remain in place, ratification would be very, very problematic.– Foreign Affairs Chrystia Freeland on the revamped NAFTA
U.S. officials have suggested that Canada and Mexico accept quotas on their steel and aluminum exports to resolve the impasse. By setting the tariff-free threshold high enough, an agreed-upon level of NAFTA trade would no longer face extra costs, while U.S. producers would continue to be protected from any unexpected surges in North American supply.
But both Canada and Mexico have been unwilling to accept limits on their tariff-free trade in aluminum and steel, frustrating attempts at quickly resolving the issue so all countries can move on to ratifying the revamped NAFTA.
NAFTA ratification unlikely with tariffs in place
Alongside the optimism voiced by Seade, U.S. Treasury Secretary Steven Mnuchin told a Senate committee Wednesday that resolving the steel and aluminum tariff issue with Canada and Mexico was a priority for the Trump administration.
“The president has instructed us to try to figure out a solution,” he said. “This is a very important part of passing USMCA [the renegotiated NAFTA] which is a very important economic agreement for two of our largest trading partners.
“I think that we are close to an understanding with Mexico and Canada. I’ve spoken to the finance ministers. Ambassador Lighthizer is leading the effort on this, but I can assure you it is a priority of ours.”
Freeland said that Canada has “been having some very good, very close, really pretty much constant conversations” with her American counterparts and that as long as Canada and the U.S. keep talking, Canada is moving towards a point in time when tariffs will be lifted.
“Canada believes in the new [NAFTA] agreement that we reached with the United States and Mexico,” Freeland told reporters in Washington D.C. “We very much hope it can be ratified in all of our countries, although the domestic processes are up to each country.
“When it comes to Canada, it is certainly the case for us that as long as the tariffs remain in place, ratification would be very, very problematic.”
Freeland said that, without giving away anything said behind closed doors, Canada would continue to work toward the complete lifting of the tariffs because it would be “great for the people, the workers, the consumers, the companies in both” the U.S. and Canada.