Prime Minister Justin Trudeau will not let himself eat the wool off his back in the event of the imposition by the United States of customs tariffs of 25% on products imported from Canada. Let the new American President Donald Trump hold it for granted!
Indeed, faced with the threat of overtaxing products from Canada by 25%, the Trudeau government will apply “the principle of reciprocity” in commercial partnerships. It’s written in black and white in Monday’s Budget Update, the Fall Economic Statement.
1. TRUDEAU’S FIRMNESS OF THE PAST AS A GUARANTEE OF THE FUTURE?
To be more precise, and firm at the same time, the Trudeau government recalls in its Update the retaliatory measures that it had put in place in response to the duties imposed in 2018 by Donald Trump under section 232 by the United States on steel and aluminum.
I quote: “In 2018, when the United States imposed a surtax on imports of Canadian steel and aluminum, Canada retaliated by imposing “dollar for dollar” duties against imports of 16.6 billion dollars worth of U.S. steel, aluminum and other products. After 12 months, the United States lifted the duties imposed on Canadian products.
For the Trudeau government, this proves that Canada has already demonstrated in the past “that it would defend its businesses and its workforce by energetically protecting the national interest.”
2. HIS FIRMNESS TOWARDS CHINA, ANOTHER PROOF?
To show its firmness, the Trudeau government recalls that it recently imposed surcharges on Chinese imports in order to protect the North American market from overcapacity and oversupply.
“When Canada’s trading partners choose to compete unfairly,” the Update states, “the government will intervene to defend Canadian workers and businesses.”
Here are the exceptional measures he has taken in response to “the extraordinary threat posed by unfair market competition from China” to Canada’s essential manufacturing sectors and electric vehicle industry:
- Impose a 100% surcharge on all electric vehicles (EV) produced in China, since 1is october. This surcharge targets in particular passenger cars, trucks, buses as well as electric delivery vans and certain hybrid models.
- Impose a 25% surcharge on imports of steel and aluminum products from China, effective October 22.
3. WHAT DOES TRUDEAU EXPECT FROM FOREIGN GOVERNMENTS?
In the Update, the Liberal government says Canadian workers and businesses also have the right to expect fair treatment when doing business abroad.
“Canada’s trading partners should give Canadian businesses the same access their businesses enjoy in Canada.”
From now on, specifies the government, “reciprocity will constitute a requirement” for all federal expenditures and policies. This will apply in particular to infrastructure spending at the subnational level, tax incentives for investment, grants and contributions, sanitary and phytosanitary measures, investment restrictions, intellectual property requirements.
According to the Trudeau government, adopting reciprocal procurement policies will level the playing field for Canadian labor and businesses. Canadian businesses deserve to be treated fairly.
Notice to all heads of state: “If certain countries adopt discriminatory practices against Canadian companies, they should not expect that their companies will benefit from better access to business opportunities in Canada than that which ‘they give to Canadian companies.’
Period!
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