WASHINGTON—The U.S. and Canada are expected to announce Friday that they have agreed to drop their tariffs on each other’s steel and aluminum and all related retaliatory tariffs, removing a major source of friction between the two countries and a key obstacle to the ratification of the new NAFTA.U.S. President Donald Trump imposed a 25 per cent tariff on steel and 10 per cent tariff on aluminum from Canada, Mexico and other countries just under a year ago, controversially using a “national security” provision of U.S. trade law. Prime Minister Justin Trudeau responded with tariffs on U.S. steel, aluminum and dozens of other products.Trump’s administration had insisted for months that the tariffs on Canada would not be lifted without quotas, but the deal does not include quotas, two Canadian sources said on condition of anonymity. The details of what Canada did agree to were not immediately available.Trump had faced pressure to rescind the tariffs from both Canada and his own party. Trudeau’s government had warned Trump that Parliament would not hold a vote to approve the new NAFTA, one of his top policy priorities, if the tariffs remained in place. Senior Republican legislators told Trump that Congress also wanted the tariffs removed before holding a vote.While the tariffs are a key impediment to getting the new NAFTA approved, several other hurdles will remain. The Democrats who control the U.S. House of Representatives have demanded changes to provisions on intellectual property protections for certain pharmaceuticals, and they have demanded new provisions to allow for stronger enforcement of labour-standards rules.Trump’s tariffs have tested the bilateral relationship with Canada, especially during the NAFTA negotiations last year.Trudeau had called the tariffs illegal and insulting, arguing that Canadian industry should never be considered a national security threat to the United States. Trump had taken offence to Tru ...
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