Ottawa/Washington, (Reuters) .- Canada prepares possible reprisals while the European Union reported advances in commercial conversations on Wednesday, since the new US tariffs on metals caused more disruptions in the global economy and added urgency to the negotiations with Washington.
The duplication of tariffs on steel and aluminum imports ordered by President Donald Trump entered into force on Wednesday, the same day that his administration sought the “best offers” of commercial partners to prevent other taxes from imports to enter into force in July.
The measure will especially affect the closest commercial partners in the United States: Canada and Mexico. Canada is the main steel and aluminum exporter to the United States.
Prime Minister Mark Carney said that Canada is prepared to counterattack the United States if conversations with Washington to eliminate Trump tariffs are not successful.
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“We are in intense negotiations with the Americans and, in parallel, preparing reprisals if these negotiations are not successful,” said Carney before the House of Commons.
The Canadian union Unifor requested retaliation tariffs, while Ontario’s prime minister, Doug Ford, urged Carney to “not stay from crossed arms and let President Trump crush us.”
Trump has made the imposition of tariffs on American importers on foreign goods the central policy of their commercial wars, which have seriously disturbed world commercial flows and agitated financial markets.
The Republican President has been angry for a long time for the enormous federal commercial deficit, saying that he was emblematic of how the commercial partners “take advantage” of the US.
Trump sees tariffs as a tool to bring more manufacturing, and the jobs that go with her, back to the US.
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However, the Congress Budget Office, a non -partisan agency, said Wednesday that American economic production will fall as a result of Trump’s new tariffs to foreign products that were in force as of May 13.
The increase in US tariffs on both metals, which went from 25% to 50% introduced in March, entered into force at 00:01 on Wednesday.
It applies to all commercial partners, except to the United Kingdom, the only country that to date has reached a preliminary commercial agreement with the US during the 90 -day pause on a broader series of tariffs imposed by Trump, which ends on July 8.
‘Constructive’ Meeting: European Union
The commercial negotiator of the 27 countries of the European Union (EU), Maros SEFCOVIC, and the United States commercial representative, Jamieson Greer, said his meeting in Paris was constructive.
“We both concluded that we advance in the right direction, at a good pace,” Sefcovic told the press.
He added that the technical conversations were ongoing in Washington, and that high -level contacts would be maintained later.
“What makes me optimistic is that I see progress (…) discussions are now very specific,” said Sefcovic.
Greer said the conversations were progressing rapidly and demonstrated “the will of the EU to work with us to find a concrete way of moving towards reciprocal trade.”
Sefcovic said that he deeply lamented the duplication of steel tariffs, and emphasized that the EU has the same challenge as the United States regarding steel (overcapacity) and that they should work together on that.
Global disruption, local pain
In another sign of disturbances in world trade, concerns about the damage caused by China’s restrictions on critical mineral exports, with some European auto parts plants, suspending production and the German car manufacturer BMW warning that its supplier network was affected by the shortage of rare land.
Trump said early Wednesday that Chinese President Xi Jinping is hard and “extremely difficult to negotiate,” exposing friction after the White House increased the expectations of an expected phone call between the two leaders this week on commercial issues, including critical minerals.
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The expected increase in levies shook the steel and aluminum market this week, especially the latter.
The worldwide markets, bonds and shares calmly accepted the most recent tariffs, and investors bet that current taxes may not last and that the president will move away from such extreme actions.
The uncertainty about Trump’s commercial policy has wreaked havoc throughout the world.
The new tariffs will affect “everything from cars and airplanes to aluminum containers for beer, cans for processed products and machinery and equipment,” said Marc Busch, a professor at Georgetown University and expert in commercial policy.
The American Automotive Policy Council said that tariffs will increase the cost of assembling a car in the United States and will put the industry and US workers at a disadvantage in the global market.
Bernard Yaros, a leading American economist in Oxford Economics, estimated that new metal tariffs will reduce business spending on equipment and structures between 0.4% and 0.5%, “more than double the expected impact on consumer spending.”
The aluminum association urged the Trump administration to reserve high tariffs for bad actors, including China, and include exceptions for partners such as Canada.
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