Canada, Mexico, EU retaliate against U.S. steel and aluminum tariffs

Last Updated May 31, 2018 6:31 PM EDT

Key U.S. economic allies are firing back with retaliatory trade measures following the Trump administration's move to impose steep tariffs on steel and aluminium imports.

Canada's government on Thursday announced plans to levy tariffs on products including American-made steel and aluminum. That policy will continue so long as the U.S. tariffs remain in force.

The White House has said the U.S. tariffs -- 25 percent duties on steel and 10 percent on aluminum shipments from Canada, EU member states and Mexico -- are necessary to safeguard U.S. national security.

In announcing his country's response, Canadian Prime Minister Justin Trudeau said it was "inconceivable" that Canada "could be considered a national security threat to the United States," noting that U.S. fighter planes and tanks contain Canadian steel.

"These tariffs will harm industries and workers on both sides of the Canada-U.S. border and will disrupt supply chains that have made steel and aluminum from North America more competitive across the whole world," he said in a press conference in Ottawa.

Effective July 1, Canada will impose tariffs of 25 percent on shipments of U.S. steel and 10 percent on aluminum, as well as on other products, such as playing cards, inflatable boats and yogurt. Canada's finance ministry estimated the value of the U.S. goods subject to those tariffs at up to C$16.6 billion ($12.8 billion), 

Jean-Claude Juncker, president of the European Commission, said the European Union also will apply news tariffs on American goods, with the trading bloc signaling it would target products made in states represented by key Republican leaders. The EU has said it would respond with tariffs on $3.3 billion in American imports as early as June 20.

"The U.S. now leaves us with no choice but to proceed with a [World Trade Organization] dispute settlement case and with the imposition of additional duties on a number of imports from the U.S. We will defend the Union's interests, in full compliance with international trade law," Juncker said in a statement.

In March, the EU made public a 10-page list of possible targets. The extensive lineup includes an array of agricultural products, including rice and tobacco, as well as automobiles and motorcycles, whiskey, paper products, shoes, and blue jeans.

"Everybody loses in a protracted trade war, we encourage countries to work constructively together to reduce trade barriers and to resolve trade disagreements without resort to exceptional measures," a spokesperson for the International Monetary Fund said in a statement. "It is unfortunate that trade tensions are rising at a moment where the global recovery is being supported by trade."

Mexico's government said Thursday it would levy taxes on imported U.S. products including pork bellies, apples and cheese, along with some types of steel.

"Mexico reiterates its position against protectionist measures that affect and distort international merchandise trade," the government said in a statement

Christine Lagarde, Managing Director of the International Monetary Fund, tweeted from the G7 Symposium in Whistler, Canada, saying: "At the end of the day, if #trade is massively disrupted, if the level of trust among economic actors is severely damaged, those who will suffer most are the poorest people #G7."  

In addition to swift denouncements from U.S. allies, the Trump tariffs were bashed by some Republicans, including House Speaker Paul Ryan.

"Instead of addressing the real problems in the international trade of these products, today's action targets America's allies when we should be working with them to address the unfair trading practices of countries like China," he said. "There are better ways to help American workers and consumers."

Sen. Ben Sasse was blunter in criticizing the tariffs.

"This is dumb. Europe, Canada and Mexico are not China, and you don't treat allies the same way you treat opponents," the Nebraska Republican said in a statement. "We've been down this road before -- blanket protectionism is a big part of why America had a Great Depression. 'Make America Great Again' shouldn't mean 'Make America 1929 Again.' "