The Canadian government has taken a bold step to address the unfair trade practices of China in the electric vehicles (EVs) sector, and the steel and aluminum industries. After holding consultations with stakeholders, the government has decided to impose a 25% surtax on steel and aluminum imports from China, effective October 15, 2024.
The move comes as a response to China’s significant subsidization and non-market policies, which have led to structural overcapacity in the steel and aluminum sectors. China produces a staggering 54% of global steel and 59% of global aluminum, making it difficult for Canadian firms to compete.
The surtax aims to protect Canadian workers and investments in these sectors from China’s unfair trade policies and prevent trade diversion resulting from recent actions by Canadian trading partners.
Goods already in transit to Canada before and on October 15, will be exempt from the surtaxes. The final list of affected goods will be announced by October 1, 2024. Written comments must be submitted by September 20, 2024. The government plans to review the surtax within a year and may extend it for a further period and add supplemental measures, as needed.
This move demonstrates Canada’s commitment to fair trade practices and its willingness to act against countries that don’t play by the rules. As the global trade landscape continues to evolve, it’s crucial for governments to prioritize the interests of their workers and industries. If you have questions on how this may impact your business, reach out to Mohawk Global Trade Advisors.
By Clarissa Chiclana