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(MNI) Ottawa

U.S. President Donald Trump said Thursday he will impose a 10% tariff on aluminum from Canada, returning to a theme of protectionism a month after a new trade pact to replace Nafta took effect.

Trump told workers at an Ohio Whirlpool plant his plan was to "bring millions and millions more jobs and thousands more factories back to American shores where they belong," in a campaign speech as he seeks a second term. "Politicians let foreign nations steal our jobs" and "plunder" the economy through unfair trade practices like currency manipulation and dumping of goods, he said.

"Canada was taking advantage of us, as usual," Trump said. "The aluminum business was being decimated by Canada, very unfair to our jobs and our great aluminum workers." Canada had violated a pledge not to flood the U.S. market in recent months, he said.

While the USMCA agreement with the U.S., Canada and Mexico signed earlier this year ended the prospect of a widespread tariff war, Trump had always kept the threat of steel and aluminum tariffs. The president has often said he can rely on a national security law to impose such tariffs, although Canada and the U.S. share a continental defense system and are partners in NATO.

Canadian Prime Minister Justin Trudeau has argued the U.S. can't produce enough aluminum to meet its needs anyways so tariffs will only boost costs for American firms and consumers. The U.S. in the past has put tariffs on both Canadian aluminum and steel, which led Canada to retaliate dollar-for-dollar on imported U.S. products.

The new dispute may weaken Canada's dollar, which had been gaining earlier this year as the Fed offered major stimulus and there are signs the world's largest economy will be slowed by troubles containing Covid-19.

It may also rattle relations with China, after the U.S. signed a Phase One trade deal earlier this year and then cooled on a deeper pact.

MNI Ottawa Bureau | +1 613-314-9647 |
MNI Ottawa Bureau | +1 613-314-9647 |

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