US President Donald Trump has announced plans to double planned steel and aluminum tariffs on Canada from 25% to 50%. The reactionary move has prompted the Ontario provincial government to withdraw previously planned surcharges on electricity exported to the US.
Mr Trump said the tariff hike, which is set to take effect on Wednesday, was in response to rising electricity prices set by the Ontario government for supplies to the United States.
On Tuesday, he posted the following message on his social media platform, Truth Social: “I have directed my Secretary of Commerce to impose an ADDITIONAL tariff of 25% to 50% on all STEEL and ALUMINUM SHIPPED TO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFF COUNTRIES IN THE WORLD.”
The US stock market immediately fell after this news was released.
Ontario Premier Doug Ford said Tuesday afternoon that U.S. Commerce Minister Howard Lutnick had contacted him and Mr. Ford had agreed to lift the surcharge. He expressed confidence that the U.S. president would also reverse his plans for 50% tariffs on Canadian steel and aluminum.
“He needs to have a response from the president, but I'm pretty sure he's going to have to back down,” Mr. Ford said of Mr. Trump's threat to impose tariffs on steel and aluminum.
“We are not going to just give up under any circumstances. We are going to have a constructive dialogue.”
Mr Trump told the press that he was considering reinstating steel and aluminum tariffs on Canada at 25% and would “probably” do so.
Asked whether there was a risk of recession for the United States, Mr Trump replied: “I don't see it.”
The sell-off on Wall Street continued on Tuesday, briefly sending the stock market 10% below a record set just weeks ago.
The S&P 500 index fell 1.4% in afternoon trading.
As of 1:40 p.m. ET, the Dow Jones Industrial Average was down 678 points, or 1.6%, and the Nasdaq Composite was down 1%.
The S&P 500 was on the brink of what Wall Street calls a “correction,” down 10% and within 0.1 percentage point of that mark.
Mr. Trump has outlined several reasons for his hostility toward Canada, saying its separate 25 percent tariffs are intended to combat fentanyl smuggling and also complaining about Canada's high tariffs on dairy imports that hurt American farmers.
However, he continues to insist that Canada become part of the United States as a solution to the problem, infuriating Canadian leaders.
“The only thing that makes sense is for Canada to become our coveted Fifty-first state,” he wrote on Tuesday. “That would completely rid us of all tariffs and such.”
The U.S. stock market plunged after the news was released, raising further alarm after Monday's sharp sell-off forced the president to show he has a real plan to stimulate the economy rather than risk plunging it into recession.
Sourse: breakingnews.ie
