Georgia lawmakers are praising President Trump’s decision to exempt Mexico and Canada from steel and aluminum tariffs, which some legislators have seen as a precursor to a congressional vote on the renegotiated North American free-trade agreement.
The so-called U.S.-Mexico-Canada Agreement was reached as a successor to NAFTA earlier this year, but it has yet to be ratified in the three countries.
Congressional Republicans had pressured Trump to remove the tariffs, which had caused retaliatory action by Mexico and Canada that had harmed U.S. agricultural exporters and manufacturers.
Basing the tariffs on national security had also engendered consternation on the part of Canadian and Mexican diplomats, who see their countries as among the strongest security partners of the U.S.
During a Consular Conversation with Global Atlanta, Canadian Consul General Nadia Theodore said her country understood that the security justification was based more on shoring up the American ability to produce these vitally important metals than it was about any sort of actual threat.
But she underscored that the unilateral decision to impose what she called “illegal tariffs” had inserted a wedge into ratification talks. Canada’s parliament, she said at the time, would not vote on the new agreement without their removal.
She added that failing to target the tariffs missed the real problem: competitors like China dumping their artificially low-priced steel and aluminum in North America.
“We’re not telling you what to do with vis-a-vis other countries, and in fact we might want to jump on board, but when it comes to Canada and the U.S., your very argument in fact is evidence that we need to be together on this,” Ms. Theodore said during the discussion.
Georgia’s Republican senators, meanwhile, saw the move as proof that the Trump negotiation tactic had run its course after applying the appropriate leverage to reach a new North American trade deal.
“While I was concerned about the ongoing use of tariffs and the unintended consequences they have on American businesses and consumers, in the end, President Trump brought Canada and Mexico to the table, dealt with the facts that were before him and negotiated a trade agreement between our three countries. Now that a deal has been reached and steel and aluminum tariffs are being rescinded and Mexico and Canada are no longer threatening to retaliate, the president’s approach has been vindicated, and he is to be commended for his efforts,” U.S. Sen. Johnny Isakson said in a statement.
Mr. Isakson had initially warned against the tariffs but when speaking to Global Atlanta last year seemed to be coming around to Mr. Trump’s more combative approach.
“It looks like what he’s done was a catalyst to get people to rethink their position,” he told Global Atlanta last May, just two months into the president’s tariff stance.
Former Georgia Gov. Sonny Perdue, now serving in Mr. Trump’s cabinet as the U.S. Department of Agriculture secretary, also applauded the move, calling it a “big win” for farmers as he expected Mexican and Canadian retaliatory tariffs to be removed immediately.
While backing off the metals tiff does pave the way for a USMCA vote in the U.S., it doesn’t magically remove all trade tensions. Mr. Trump has reportedly determined that auto imports have harmed American national security, but he has delayed a threatened 25 percent tariff for up to six months, according to reports.
Although the U.S., Canada and Mexico contain largely integrated automotive supply chains that advocates say are essential to regional competitiveness, Mr. Trump has sought to bring more auto activity back across the U.S. border.
The USMCA includes a higher threshold (75 percent) for the proportion of a vehicle made in the region to qualify for duty-free status, as well as new wage requirements aimed at reducing Mexico’s cost advantage.
The tariffs remain in place for most of the world, including the European Union. South Korea reached a quota deal on steel as part of the renegotiated KORUS Free Trade Agreement. Mr. Trump is set to visit Japan this week for discussions with Prime Minister Shinzo Abe as sensitive disagreements over autos and agriculture loom large in talks with the world’s third largest economy.