Rio Tinto’s BC Works in Kitimat. (File photo)

U.S. tariffs on Canadian aluminium scrapped

Joint effort by industry, government and unions secures deal

Canadian steel and aluminium industries breathed a sigh of relief following news that the punitive tariffs imposed by Trump and the U.S. government in May 2018 have been scrapped.

The announcement, made by the federal government on Friday, May 17, will see the scrapping of the 10 per cent aluminium tariff, as well as the 25 per cent steel tariff, imposed by the U.S.

Soon after the announcement Unifor Local 2301 president Martin McIlwrath said the tariffs were imposed during North America Free Trade Agreement (NAFTA) talks “in what seemed to be a means to renegotiate the NAFTA agreement.”

“Commitments were made that once the new trade agreement was reached between our countries the tariffs would be removed,” said McIlwrath.

“After there was a tentative agreement on the new NAFTA, and as soon as those commitments appeared to be nothing more than words, our union sprang into action.”

He said what followed was a concerted effort by Local 2301, the national union, the B.C. and federal government and the aluminium industry to negotiate an end to the tariffs.

READ MORE: Trump tweeted that tariffs would stay in place until NAFTA renegotiated

Unifor facilitated a meeting with premier John Horgan and the B.C. government and the federal government in Ottawa.

“Not long after Ottawa, we flew to Washington D.C., where we partnered with key leaders in the aluminum industry, including Rio Tinto. In a coordinated effort, we met with everyone with influence that would listen to us to explain how important the aluminum industry is to both our countries.

“Our message was clear – we don’t want tariffs and we don’t want quotas.”

He applauded the federal government for standing strong and keeping their word that they wouldn’t finalize the new NAFTA agreement without the tariffs being removed.

He also acknowledged the role that the Canadian aluminium industry had played in the negotiations.

“As often as we are at odds with the company, we were able to put aside our differences and work together to help save our industry. Hopefully, we can build on this and continue to work together to repair our relationship and resolve all of our outstanding issues” said McIlwrath.

Unifor national president Jerry Dias said the tariffs had affected nearly three-quarters of all Canadian aluminum exports, driving up material costs and encouraging buyers to seek alternative suppliers. Unifor has been campaigning to remove the tariffs and resist the Americans’ demands for quotas.

“Negotiating with a backbone gets results,” said Dias. “We expect a similar approach moving forward on our nation’s outstanding trade disputes with the U.S.”

He said two-thirds of all primary aluminum used in North American production originates from Canada, primarily from Quebec and B.C. Canada’s aluminum sector which employs 10,500 people, and accounts for nearly $5 billion of value-added economic activity.

READ MORE: Trump threatens Mexico with tariffs on cars produced there

Aluminium Association of Canada president and CEO Jean Simard said the total exemption from Section 232 tariffs was a great victory for the industry, the workers and Canada.

“Canada is entering a new era of free and fair trade with the U.S. and Mexico. As of next week, Canada and Mexico will be the only two countries in the world to have full and unrestricted access to the U.S. market,” said Simard. He said Canada and the U.S. had also agreed to jointly address potential issues that could potentially impact the North American value chain, including dumped, subsidized metal.

He said now that the tariffs had been scrapped it was necessary to address the situation that led to the tariffs being implemented initially – global aluminium overcapacity.

“China, which accounts for 54 percent of primary aluminum and 53 percent of the world’s processed aluminium, is the largest aluminium producer on the planet. Any solution to the global problem of oversupply must necessarily take China into account.”

B.C. premier John Horgan said the announcement was good news for the thousands of people in B.C. whose jobs were affected by these tariffs.

“We heard from many B.C. companies that these tariffs gave them significant challenges on both sides of the border,” said Horgan.

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