Federal ministers to unveil support for steel and aluminum sectors

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Federal ministers will announce support for the steel and aluminum sector Friday and will also reveal the final list of Canadian retaliatory tariffs against American goods.

The announcement is expected to include financial support for industry in the form of loans and loan guarantees, as well as measures to help affected workers through the Employment Insurance program.

Government officials told The Globe and Mail the package will be similar to last year’s support for the softwood lumber sector, which was worth a combined $867-million. That support has gone largely unused, as booming demand for lumber has overcome the higher costs of U.S.-imposed tariffs for that sector.

That package also included temporary EI changes that allowed for job-sharing to reduce the need for layoffs. Union leaders said they expect to see a similar program announced on Friday for workers in the steel and aluminum sectors.

Related: EU leaders vow to push back against protectionism, Trump tariffs

Read more: EU leaders vow to push back against protectionism, Trump tariffs

Ken Neumann, the United Steelworkers national director for Canada, said compensation for workers is clearly needed and he endorsed Canada’s plan to impose retaliatory tariffs on U.S. goods.

“The message has to be sent to the U.S. that Canada is not going to be pushed around,” he said. “We’re going to look after our industries. We’re going to look after our employees in the communities because of this illegal tariff and you can only hope that common sense is going to prevail.”

Foreign Affairs Minister Chrystia Freeland, Innovation Minister Navdeep Bains and Employment Minister Patty Hajdu are scheduled to unveil the countermeasures at the Stelco mill in Hamilton on Friday, while International Trade Minister François-Philippe Champagne will mirror the announcement at the Rio Tinto plant in Saguenay, Que.

The ministers will also be announcing a financial aid package for the industries affected by the U.S. tariffs, government officials said, speaking on the condition of anonymity ahead of the official announcement.

Last month, the U.S. government announced that the United States would slap tariffs of 25 per cent on Canadian steel and 10 per cent on Canadian aluminum effective June 1 after the Trump administration removed an exemption sparing Canada and the European Union from global measures first announced earlier this year.

U.S. Commerce Secretary Wilbur Ross blamed this move on a lack of progress in North American free-trade renegotiations with Canada and Mexico.

Prime Minister Justin Trudeau responded that Canada would reply to the American measures by imposing levies on $16.6-billion of U.S. imports starting July 1. “This is the strongest trade action Canada has taken in the postwar era,” Ms. Freeland said at the time.

Canada’s proposed target list of U.S. products included U.S. steel and aluminum, as well a slew of goods from sailboats to whisky, plywood to refrigerators and washing machines to herbicides.

While the initial list of proposed targets contained trade far in excess of the $16.6-billion in annual imports of American goods that Canada is targeting, the final list is expected to be whittled down closer to that target amount.

Canadian Labour Congress president Hassan Yussuff said he expects many of the details regarding compensation will be worked out later given that specific job sites may have different needs.

While he had not been briefed on the government’s plans, Mr. Yussuff told The Globe that his advice to Ottawa was that compensation for workers should include work-sharing through the EI system as a way of reducing layoffs.

Mr. Yussuff said he would expect the compensation package would be along the lines of what Ottawa offered last year to the softwood lumber sector following a trade dispute with the United States.

“Clearly the workers need to be helped,” he said.

Mr. Yussuff also said the form of compensation may have to change based on the length of the trade dispute.

“Obviously there’s no justification for this in the United States, but the reality is we don’t know when they may relinquish their desire to remove the tariffs and they are in [mid-term] elections so Trump may not care unless it starts to affect the American workers,” he said.

Canada’s steel industry directly employs 22,000 people in Canada and another 100,000 people indirectly, according to the United Steelworkers union. The aluminium industry employs 15,300 workers directly and another 41,000 indirectly.

With files from Steven Chase