Canada, Mexico could escape new tariffs
WASHINGTON — Two members of President Donald Trump’s Cabinet suggested Wednesday that Canada and Mexico might escape new tariffs on steel and aluminum, a potential bargaining chip in North American trade talks that heeds the ‘surgical approach” advocated by House Speaker Paul Ryan.
“The president indicated that if we can work something out with Canada and Mexico they will be exempted. It’s not inconceivable that others could be exempted on a similar basis,” Commerce Secretary Wilbur Ross told reporters. He said earlier on CNBC that the president has “indicated a degree of flexibility.”
Treasury Secretary Steven Mnuchin said the administration was “definitely going to end up” with the across-the-board tariffs Trump is seeking — 25 percent on steel imports, 10 percent on aluminum. “But, again, there will be a mechanism where, to the extent that the president wants to give waivers, the president can do that,” Mnuchin told Fox Business.
White House spokeswoman Sarah Huckabee Sanders said the White House was “on pace for an announcement” on the trade penalties “at the end of this week.”
Business leaders expressed alarm about the potential economic fallout from the tariffs Trump is pursuing, with the president and CEO of the U.S. Chamber of Commerce raising the specter of a global trade war. That scenario, Tom Donohue said, would risk the economic momentum from the GOP tax cuts and Trump’s rollback of regulations.
“We urge the administration to take this risk seriously,” he said, and opt against the tariffs.
Trump has said they’re needed to preserve the American industries and protect national security, but he also has tried to use them as leverage in the current talks to revise the North American Free Trade Agreement, negotiated under President Bill Clinton.
“We’re cautiously optimistic on NAFTA,” Mnuchin said. “This is part of those discussions. But assuming we get the new NAFTA deal done, they will be exempted.”
White House adviser Jared Kushner and staff from the State Department and National Security Council planned to meet Wednesday with Mexico’s president and foreign minister in Mexico City.
Trump also signaled other trade actions could be in the works. In a new tweet, the president said the “U.S. is acting swiftly on Intellectual Property theft.” His trade representative is investigating whether China’s rules are “unreasonable or discriminatory” to American business. Findings from that review, and possible reflationary actions, are expected to be announced in the coming weeks.