MSCI Tells United States, Canada To Withdraw Aluminum Threat
As Connecting the Dots reported last week, U.S. President Donald Trump has threatened to put back his 10 percent Section 232 tariffs on Canadian aluminum imports unless the Canadian government imposes quotas on its exports.
On behalf of MSCI, on July 1 President and CEO Bob Weidner wrote to President Trump, along with Canadian Prime Minister Justin Trudeau, asking that neither the United States nor Canada impose aluminum penalties or protections. Weidner noted that, from the moment President Trump began considering 232 tariffs on metals’ imports in 2017, MSCI maintained that North American trading partners should be exempt since relationship between these countries benefits metals workers and their families, and the North American economy. (MSCI’s responses to the Trump administration’s Section 232 steel and aluminum investigations, which make that request, are available here.)
That stance remains MSCI’s position today.
Weidner’s letter to President Trump and Prime Minister Trudeau maintained that the aluminum sector in the United States is not harmed by trade from Canada, nor is the Canadian industry disadvantaged by its partners to the south. Instead, the United States and Canada enjoy a substantial and beneficial metals trading relationship. That is why MSCI has advocated that the United States and Canada target penalties toward non-market countries like China, which have routinely and flagrantly thwarted international and U.S. trade laws.
Instead of imposing penalties on one another’s products, Weidner advised that “the United States and Canada should engage with trading partners directly to reduce global excess capacity, both bilaterally and multilaterally. It should be a stated principal objective of your trade policy to target excess capacity in countries that raise capacity through market distorting policies.” The objective of this policy would be to reduce global excess capacity, as determined by U.S. and Canadian trade agencies, by a certain percentage over a period of five years. The policy also would state that failure to reach negotiated reductions would be subject to offsetting trade sanctions.
Click here to read the full letter.
Also last week: Prime Minister Trudeau said, “What we’ve simply highlighted is: the United States needs Canadian aluminum. They do not produce enough, nowhere near enough aluminum in the States to fulfill their domestic manufacturing needs. Therefore, if they put tariffs on Canadian aluminum, they are simply increasing the costs of inputs, necessary inputs, to their manufacturing base, which will hurt the American economy.”