Earlier this week, advocates representing companies on both sides of the latest cross-border dispute over Washington’s protectionist aluminum tariffs squared off in an online forum hosted by the Washington International Trade Association.
As reported here, much of the discussion focused on relitigating disputed aspects of the complaint recently made by two U.S. smelters of primary aluminum that successfully obtained import duty protection (i.e., the reimposition of Section 232 tariffs on unwrought aluminum) from the Trump administration after claiming financial hardship stemming from a purported “surge” of unalloyed Canadian product earlier in the year.
The Bigger Picture
Regarding larger trade policy and “national security” issues presently confronting the industry, which as Aluminum Association president Tom Dobbins pointed out, are in many respects the same as those now challenging political leaders in the U.S. and around the world, the two sides were also deeply divided, particularly in terms of the best way to tackle the growing threat posed by global overcapacity.
Contending that illegal government subsidies are a worldwide problem that cannot be attributed solely to China (while ignoring the fact that Beijing’s massive subsidies dwarf those of any other country), the trade lawyer for the lone U.S. producers argued that to ensure their continued viability in future, import tariff protections should be applied as broadly and “comprehensively” as possible. Opposed to this “shortsighted and self-serving” approach, lobbyists for the trade group representing the vast majority of the industry in Canada and the U.S. instead pushed the need for a coordinated, multilateral strategy of “containment” among market economies aimed squarely at dealing with China as the main source of the overcapacity crisis.
Tariff Exclusion Paradox
One point of general agreement did arise, however, when it came to the administration’s self-defeating practice of granting numerous exclusions to the Section 232 tariffs, with everyone sharing the opinion that it not only undermines the stated purpose of the additional levy but also calls into question the legitimacy of its premise. That said, as if to illustrate the complex nature of the issue, such concerns ironically didn’t prevent any of the experts from advising a company worried about getting caught in the cross-hairs of the trade dispute both when importing and exporting, to immediately seek duty relief utilizing the tariff exclusion processes afforded by the Canadian and U.S. governments.
Note: Following some technical difficulties at the outset, the discussion begins roughly 5 minutes into the video. For an audio-only MP3 version of this program, click here.
- U.S. Reimposes Tariff on Raw Canadian Aluminum (August 7)
- Trump Administration Threatens to Hit Canadian Aluminum Exports with 10% “Snap Back” Tariff (June 27)