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Hamilton (ON), Jul 2 (IBNS): Canada said it was well prepared to counter United States (U.S.) imposition of tariffs of 25 percent on Canadian steel and 10 percent on aluminum, which came into effect on July 1, media reports said.
While confirming $16.6-billion worth of American goods will be hit with retaliatory tariffs on Canada Day, Canada pledged up to $2 billion for the steel and aluminum sectors in Canada.
In addition to steel and aluminum products, other items which could be affected included goods such as ketchup, orange juice, playing cards and pens.
Canada's Foreign Minister Chrystia Freeland was hopeful that Canada’s dollar-for-dollar response would not prompt further tariffs from the U.S.
“Canada’s approach is and will be this: we will not escalate and we will not back down,” Freeland told reporters, and added that the Canadian tariffs were permitted under World Trade Organization (WTO) rules.
But Trump told that if auto imports posed a national security threat, he could impose tariffs of up to 25 percent.
Freeland said Trump's move was not justified but, added Freeland, that Canada was prepared for all possible outcomes.
She also said that she was in frequent contact with U.S. officials.
“I’ve expressed our willingness to return anytime, anywhere to discuss this issue,” Freeland said.
Canada's pledge of $2-billion would reportedly be complemented by $1.7 billion in loans and services to help the aluminum and steel sectors, including small- and medium-size business affected by the U.S. tariffs.
Canada would also provide liquidity support to affected businesses in provinces and territories to increase jobs and training funds for workers.
A grant of $250 million to boost Canadian manufacturers and better integrate aluminum and steel supply chains would also be given by Strategic Innovation Fund.
Canada had also pledged another $50 million over five years to help companies take better advantage of the new free trade agreement with Europe and the Trans-Pacific Partnership.
With looming uncertainty of North American Free Trade Agreement (NAFTA) negotiations, Marvin Ryder, a business professor at McMaster University in Hamilton, said Ottawa “had to do something active to assist companies and workers caught in the crossfire of the trade dispute...This is something Canadian companies have needed to do for a long time.”
(Reporting by Asha Bajaj)