A
worker assembles an SUV at a car plant of Li Auto, a major Chinese EV maker, in
Changzhou in eastern China's Jiangsu province on March 27.THE CANADIAN PRESS
The
federal government says it will not allow Canada to become a dumping ground for
diverted Chinese steel or aluminum after the United States announced it plans
tariff hikes on imports from China.
U.S. tariffs on certain Chinese steel and aluminum products will
climb to 25 per cent this year from as much as 7.5 per cent. The proposed
higher tariff rate, announced this week, would apply to
more than US$1- billion worth of steel and aluminum products.
“Canada is not and will not be a ‘back door’ for Chinese steel
and aluminum,” Navpreet Chhatwal, communications adviser for Finance Minister Chrystia Freeland, said in a statement
Wednesday.
“Canada has a robust, responsive trade-remedy system to prevent
dumped and subsidized imports and is committed to protecting our workers and
industry from unfair trade,” Ms. Chhatwal said.
Ms. Freeland’s office did not rule out any measures but said it
is still analyzing the American action.
The White House justified the tariffs by saying China is
off-loading unfairly produced steel and aluminum in the United States.
“China’s policies and subsidies for their domestic steel and
aluminum industries mean high-quality, low-emissions U.S. products are undercut
by artificially low-priced Chinese alternatives produced with higher
emissions,” the White House said in a Tuesday statement.
Canadian international trade lawyer Lawrence Herman said Canada
should act quickly to enact tariffs to ward off Chinese steel and aluminum that
might be redirected from the U.S. to markets with lower trade barriers.
He said this country shouldn’t wait for Ottawa’s trade-remedy
system to handle a complaint from Canadian industry over unfair imports.
“The trade-remedy process is a slow, cumbersome process,” he
said. “It requires industry to file complaints, complaints are investigated. It
takes a long time to get the Canadian International Trade Tribunal to issue an
order to apply anti-dumping or countervailing duties. I don’t think trade
remedies are the answer.”
The risk, Mr. Herman said, is that Chinese steel gets dumped in
Canada or the Canadian market becomes a clearing house for the transshipment of
steel from China through this country and then into the United States.
He said Canada should enact targeted tariffs based on the same
rationale employed by the Americans.
Mr. Herman noted that Section 53 of Canada’s Customs Tariff Act
allows Ottawa to take pro-active steps in response to any major increase of
Chinese goods into our country that are subsidized imports and in breach of
trade agreements.
The tariff announcement was released in the middle of a heated
campaign between presidential contenders Joe Biden and Donald Trump, his
Republican predecessor. Both have tried to show who’s tougher on China.
The Chinese economy has been slowed by the collapse of the
country’s real estate market and past coronavirus pandemic lockdowns, prompting
President Xi Jinping to try to jump-start growth by ramping up production of
electric vehicles and other products, making more than the Chinese market can
absorb.