Mnuchin urged Trump to exempt Canada from metal tariffs: report

Mnuchin urged Trump to exempt Canada from metal tariffs: report
© Greg Nash

Treasury Secretary Steven MnuchinSteven Terner MnuchinTop economic adviser warned Trump on reelection chances ahead of China truce: report The Hill's Morning Report - Tempers boil over at the White House Schumer seeks focus on health care amid impeachment fever MORE urged President TrumpDonald John TrumpZuckerberg launches public defense of Facebook as attacks mount Trump leaning toward keeping a couple hundred troops in eastern Syria: report Warren says making Israel aid conditional on settlement building is 'on the table' MORE at a White House trade meeting on Tuesday to exempt Canada from the steel and aluminum tariffs that were recently announced, sources told ABC News.

Mnuchin told the president that, because the U.S. has a $2 billion steel surplus and more than a $25 billion service surplus with Canada, he should consider exempting the nation from the tariffs, ABC News reported.

“He’s still deciding on what to do about Canada,” one source told ABC News, referring to Trump.

Trump announced last week that he would implement a 25 percent tariff on imported steel and a 10 percent tariff on imported aluminum from key allies, including Canada, Mexico and the European Union (EU).

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The EU, Canada and Mexico had previously been exempt from the tariffs, which Trump originally announced in March.

The newly announced tariffs have caused some to fear a possible trade war with U.S. allies, an issue that is likely to come up at the Group of Seven summit in Canada on Friday.

Canadian Prime Minister Justin Trudeau said it is “insulting” that the U.S. considers Canada a national security threat.

To justify the tariffs, Trump cited Section 232, a rarely invoked law that allows tariffs to be placed on a country for national security reasons.

Trudeau noted that Canada will also place similar tariffs on steel, aluminum and other consumer goods in retaliation for the tariffs.

The U.S. has been negotiating a new North American Free Trade Agreement with Canada and Mexico in recent months.

The director of the National Economic Council, Larry Kudlow, has said that Trump is considering negotiating separate trade agreements with Mexico and Canada.

The U.S. had a $17.5 billion goods deficit with Canada in 2017 and — when services are included in the measurement — an overall surplus of $8.4 billion with Canada in 2017, according to the U.S. Trade Representative’s office.