Canada's chief trade negotiator says the new North American trade deal won't limit the federal government's options if it is forced to retaliate against U.S. tariffs on steel and aluminum.
Steve Verheul tells a House of Commons committee hearing that under the terms of the May 2019 agreement on tariffs, Canada would be able to impose retaliatory levies against American aluminum, as well as any U.S. products containing it.
However, Verheul also says the federal government will have to wait and see exactly what the U.S. decides to do before choosing how to respond.
U.S. Trade Representative Robert Lighthizer has accused Canadian aluminum producers of exceeding export limits established last spring when the White House agreed to lift its tariffs on metals imports from north of the border.
Verheul says Canadian producers had to adjust their production as a result of a plunge in demand resulting from the COVID-19 pandemic, and the U.S. is misinterpreting those changes as a "surge" in exports.
In a public question-and-answer session today, Lighthizer offered no hints about what the Trump administration intends to do — although he did defend the use of tariffs as a tool for keeping trading partners in line.
