The United States has agreed to lift its tariffs on steel and aluminum imports from Canada and Mexico.

The move, which removes a major obstacle to renegotiating the North American Free Trade Agreement (NAFTA), will be implemented by Sunday afternoon, officials said.

President Donald Trump had imposed the tariffs — 25% on steel and 10% on aluminium imports — in March 2018 on national security grounds, saying the US market was being flooded with cheap imports from other countries, particularly China.

Under this weekend's agreement Canada and Mexico will also eliminate retaliatory tariffs on US products including cheese, milk and bourbon.

Canadian Prime Minister Justin Trudeau said it would open the way to further talks on a revised free trade deal.

"Obviously, these continued tariffs on steel and aluminum and our countermeasures, represented significant barriers to moving forward with the new NAFTA agreement," he said on Friday.

"Now that we've had a full lift on these tariffs, we are going to work with the United States on timing for ratification, but we're very optimistic we're going to be able to move forward move forward well in the coming weeks."

Speaking in Washington, Trump said he was now hopeful NAFTA could be replaced with the new U.S.-Mexico-Canada Agreement (USMCA).

"That deal is going to be a fantastic deal for our country and hopefully Congress will approve the USMCA quickly, and then the great farmers and manufacturers and steel plants will make our economy even more successful than it already is, if that's possible, which it is possible," he said. </s> President Trump is imposing steep tariffs on steel and aluminum from three of America's biggest trading partners — Canada, Mexico and the European Union.

The trade penalties, 25% on imported steel and 10% on imported aluminum, take effect at midnight, Commerce Secretary Wilbur Ross told reporters Thursday.

The announcement immediately raised the risk of retaliatory tariffs against American products.

Trump announced worldwide steel and aluminum tariffs in March but granted exemptions to some major trading partners.

Canada, Mexico and the EU were among the countries granted relief while the United States pursued negotiations to address the administration's concerns about the state of domestic steel and aluminum production. Those negotiations had a Friday deadline.

Trump's decision could raise prices for Americans on a range of everyday products. It could also place the United States in a trade dispute on more than one front. The administration is separately moving ahead with tariffs on Chinese goods.

Trump imposed the steel and aluminum penalties under a 1962 law that gives the president broad power to increase or reduce tariffs on goods deemed critical to national security.

"We take the view that without a strong economy, you cannot have strong national security," Ross told reporters.

Trump's announcement lifted American steel and aluminum stocks because those companies stand to benefit from penalties against their foreign competitors. U.S. Steel climbed 3%. But the broader market sank because of trade war fears. The Dow fell about 200 points.

Europe had promised swift retaliation if it was hit with the trade penalties, and had warned it could quickly respond with 25% tariffs on US products such as motorcycles, denim, cigarettes, cranberry juice and peanut butter.

Getting rid of the exemptions for Canada and Mexico, meanwhile, could complicate ongoing negotiations on NAFTA. Canada had also pledged to retaliate.

"Should restrictions be imposed on Canadian steel and aluminum products, Canada will take responsive measures to defend its trade interests and workers," Canadian Foreign Minister Chrystia Freeland said in March.

The NAFTA talks were one factor in the administration's decision to grant exemptions to Canada and Mexico from the steel and aluminum tariffs. But Ross said Thursday that those talks "are taking longer than we hoped."

Related: The global steel industry by the numbers

Canada was the largest exporter of steel to the United States by value last year, according to data from Wood Mackenzie. Mexico was the third largest, behind South Korea.

The Trump administration said Tuesday that it is moving forward with tariffs on $50 billion worth of Chinese goods as punishment for intellectual property theft.

The Chinese government said the announcement was "obviously in violation of the consensus reached in Washington recently by both China and the United States." Both parties had previously said that tariffs would be put on hold as talks continued.

Ross is scheduled to go to China this weekend for a third round of negotiations.

The United States is also exploring the possibility of putting new tariffs on cars. Last week, The Trump administration announced an investigation into whether automobile imports are hurting US national security, laying the groundwork for another trade fight.

Such an action could hurt Mexico, Canada, Germany and Japan.

— CNNMoney's Alanna Petroff, Nathaniel Meyersohn and Matt Egan contributed to this report. </s> U.S. Will Lift Tariffs On Steel And Aluminum From Canada And Mexico

Enlarge this image toggle caption Candace Elliott/Reuters Candace Elliott/Reuters

Updated at 3 p.m. ET

The Trump administration has reached a deal to lift tariffs on steel and aluminum imports from Canada and Mexico, in a move that could put the three nations a step closer to ratifying the USMCA trade deal that would replace NAFTA.

The tariffs will be lifted within two days, according to a joint U.S.-Canada statement posted by Canada's foreign ministry.

The U.S. tariffs on metals from Canada and Mexico have been in effect for nearly a year, with steel imports subject to a 25% tariff and aluminum to a 10% hike. Retaliatory tariffs from Canada and Mexico have been in place for nearly as long.

"I'm pleased to announce that we've just reached an agreement with Canada and Mexico" to end the recent tariffs, President Trump said during at a National Association of Realtors event Friday.

Trump then called on Congress to ratify the USMCA, to "make our economy even more successful than it already is — if that's possible. Which, it is possible."

Mexico's foreign affairs undersecretary for North America, Jesús Seade, also hailed the agreement, saying it was received with "great enthusiasm" in Mexico. He added, "This action opens the path to advance toward the ratification" of the replacement NAFTA deal.

Discussing the breakthrough Friday afternoon, Canadian Prime Minister Justin Trudeau said, "There was no one breakthrough moment" in negotiations.

At the Stelco steel plant in Hamilton, Ontario, Trudeau told reporters that he had "lots of conversations with the [U.S.] president over the past week, and an understanding as well that these tariffs were harming workers and consumers on both sides of the border."

And with both countries' leaders now hoping to get the USMCA ratified, Trudeau said, "it didn't make a lot of sense to continue to have tariffs on steel and aluminum between our countries."

Trudeau spoke to Trump about a deal to end the tariffs around midday, according to Cameron Ahmad, Trudeau's director of communications.

The joint U.S.-Canada statement says the two countries will establish a way to monitor aluminum and steel trade between them, with an eye to prevent the "transshipment" of aluminum and steel produced by a third country.

The deal also calls on both countries to prevent the importation of aluminum and steel that is "unfairly subsidized and/or sold at dumped prices."

The pact also leaves room for tariffs to be instated "imports of aluminum or steel products surge meaningfully beyond historic volumes of trade over a period of time, with consideration of market share."

"Canada buys more American steel than any other country in the world, accounting for some 50% of U.S. exports," the Canadian government says. It adds that nearly 84% of Canadian aluminum production is exported to the U.S.

In response to the tariff deal, the Coalition of American Metal Manufacturers and Users, or CAMMU, welcomed the news and called on the Trump administration to lift other steel and aluminum tariffs. The group of U.S. businesses and trade associations represents some 30,000 companies and was formed to advocate against Trump's tariffs on metals.

"These tariffs are damaging the U.S. manufacturing sector, and particularly downstream U.S. steel and aluminum consuming companies, by increasing prices and lead times for both domestic and imports of steel and aluminum and making the U.S. an island of high steel prices," the coalition said in a statement sent to NPR Friday.

CAMMU also praised the new agreement for not replacing the newly eliminated tariffs with quotas, which it described as "even worse for U.S. companies."

Trump imposed steel and aluminum tariffs on every country except Canada and Mexico about a month after receiving a letter from 25 U.S. steel and metal companies urging him to act "to prevent excess steel capacity and surging steel imports from undermining our national security and the viability of the U.S. steel industry."

Trump's original order included carve-outs for the closest U.S. neighbors. But after talks on a revised NAFTA deal took longer than the U.S. administration had hoped, Canada and Mexico were included in the tariffs. The leaders of the three countries signed the new U.S. Mexico Canada Agreement in late November. It won't take effect until all three countries' legislatures have voted to ratify the trade pact.

In late April, Senate Finance Committee Chairman Chuck Grassley, R-Iowa, warned Trump that the USMCA deal would be "dead" unless the steel and aluminum tariffs were lifted.

News of a deal to lift the tariffs comes two days after Treasury Secretary Steven Mnuchin said during testimony before a Senate Appropriations subcommittee that a deal was in the offing.

Earlier this week, Mexican Economy Secretary Graciela Márquez Colín said she believed a solution to the tariff standoff was imminent, as she held meetings in Toronto with Canadian Foreign Minister Chrystia Freeland. </s> President Donald Trump on Friday announced a deal to lift US tariffs on steel and aluminum imports from Canada and Mexico that had created friction between the neighbors and blocked a new North American free trade agreement.

"I'm pleased to announce that we've just reached an agreement with Canada and Mexico and will be selling our product into those countries, without the imposition of tariffs," Trump said at an event in the US capital.

His statement came moments after Canada released the text of the agreement between Ottawa and Washington in which they agreed to eliminate US tariffs on steel and aluminum, and Canada's retaliatory measures, within no more than two days.

Mexico confirmed it had reached a similar agreement with the United States.

The steep US tariffs imposed last year -- 25 percent on steel and 10 percent on aluminum -- became a major stumbling block to ratifying a new North American trade pact negotiated last year by the three countries.

Canada and Mexico initially were exempted from the tariffs Trump enforced using a national security argument, as part of his hardline trade tactics.

Once America's neighbors were included, the levies drew retaliation with tariffs on a host of US products.

Even after the governments agreed to a revised free trade deal -- the US-Mexico-Canada Agreement, or USMCA -- the tariffs remained in place, but officials in Ottawa and Mexico City said they would not sign unless Washington removed the metals duties.

Speaking to reporters in Ottawa, Canada's Prime Minister Justin Trudeau said there was a shared recognition that "these tariffs were harming workers and consumers on both sides of the border" and "didn't make a lot of sense" in the context of a new free trade deal.

"Obviously these continued tariffs on steel and aluminum and our countermeasures represented significant barriers to moving forward with the new NAFTA agreement," he said, referring to the 24-year-old North American Free Trade Agreement.

"Now that we've had a full lift on these tariffs we are going to work with the United States on timing for ratification but we're very optimistic we are going to be able to move forward well in the coming weeks," Trudeau said.

Mexican chief trade negotiator Jesus Seade likewise tweeted that the lifting of tariffs "clears the way towards ratification of USMCA."

Some key members of the US Congress had said they would not agree to vote for the three-country free trade pact unless the Trump's metals tariffs ended.

"Hopefully Congress will approve it quickly," said Trump.

Democratic US Senator Chuck Schumer applauded the decision to remove the metals tariffs, but said there are other concerns about the USMCA.

"It is a good thing these tariffs will be lifted, and we should urge our allies to join us in preventing China's predatory practices," Schumer said in a statement.

However, "There are still many other issues that are outstanding before Democrats would support the USMCA."

According to the agreement, Canada and Mexico will withdraw all complaints lodged against the United States at the World Trade Organization.

The two countries also agreed to monitor imports of steel and aluminum to ensure metals that are sold at "dumped prices" -- below the cost of production -- are not purchased in or shipped through Canada and Mexico.

In addition, they agreed to a provision to reimpose steep duties if imports of the metals "surge meaningfully beyond historic volumes of trade over a period of time."

The US Trade Representative's office said the agreement "provides for aggressive monitoring and a mechanism to prevent surges in imports of steel and aluminum."

"This agreement is great news for American farmers that have been subject to retaliatory tariffs from Canada and Mexico," USTR said.

US tariffs on steel and aluminum from Europe remain in place, as does the EU retaliation. Some countries, including South Korea, accepted export quotas to avoid the tariffs. </s> US President Donald Trump on Friday announced a deal to lift US tariffs on steel and aluminum imports from Canada and Mexico that had created friction between the neighbors and blocked a new North American free trade agreement.

"I'm pleased to announce that we've just reached an agreement with Canada and Mexico and will be selling our product into those countries, without the imposition of tariffs," Trump said at an event in the US capital.

His statement came moments after Canada released the text of the agreement between Ottawa and Washington in which they agree to eliminate US tariffs on steel and aluminum, and Canada's retaliatory measures, within no more than two days.

Mexico subsequently confirmed it had reached a similar agreement with the United States.

The steep US tariffs imposed last year -- 25 percent on steel and 10 percent on aluminum -- became a major stumbling block to ratifying a new North American trade pact negotiated last year by the three countries.

Canada and Mexico initially were exempted from the tariffs Trump enforced using a national security argument, as part of his hardline trade tactics.

Once America's neighbors were included, the levies drew retaliation with tariffs on a host of US products.

Even after the governments agreed to a revised free trade deal -- the US-Mexico-Canada Agreement, or USMCA -- the tariffs remained in place, but officials in Ottawa and Mexico City said they would not sign unless Washington removed the metals duties.

Speaking to reporters in Ottawa, Canada's Prime Minister Justin Trudeau said there had was a shared recognition that "these tariffs were harming workers and consumers on both sides of the border" and "didn't make a lot of sense" in the context of a new free trade deal.

"Obviously these continued tariffs on steel and aluminum and our countermeasures represented significant barriers to moving forward with the new NAFTA agreement," he said, referring to the 24-year-old North American Free Trade Agreement.

"Now that we've had a full lift on these tariffs we are going to work with the United States on timing for ratification but we're very optimistic we are going to be able to move forward well in the coming weeks," Trudeau said.

Mexican chief trade negotiator Jesus Seade likewise tweeted that the lifting of tariffs "clears the way towards ratification of USMCA."

Some key members of the US Congress had said they would not agree to vote for the three-country free trade pact unless the Trump's metals tariffs ended.

"Hopefully Congress will approve it quickly," said Trump.

According to the agreement with Canada, the two governments will withdraw all complaints lodged in the World Trade Organization.

The two countries also agreed to monitor imports of steel and aluminum to ensure metals that are sold at "dumped prices" -- below the cost of production -- are not purchased in or shipped through Canada.

In addition, they agreed to a provision to reimpose steep duties if imports of the metals "surge meaningfully beyond historic volumes of trade over a period of time."

US tariffs on steel and aluminum from Europe remain in place, as does the EU retaliation. Some countries, including South Korea, accepted export quotas to avoid the tariffs.

Get the latest election news, live updates and election schedule for Lok Sabha Elections 2019 on ndtv.com/elections. Like us on Facebook or follow us on Twitter and Instagram for updates from each of the 543 parliamentary seats for the 2019 Indian general elections. Election results will be out on May 23. </s> United States President Donald Trump on Friday announced a deal to lift tariffs on steel and aluminium imported from Canada and Mexico that had halted discussions on a new North American free trade agreement and complicated relations between America and its neighbours, The New York Times reported.

“I am pleased to announce we have just reached an agreement with Canada and Mexico,” Trump said. “We will be selling our product into those countries without the imposition of tariffs.”

The statement came moments after Canada released the text of the agreement between Ottawa and Washington to eliminate US tariffs on steel and aluminium, and Canada’s retaliatory measures, within two days, CNBC reported. Soon after, Mexico confirmed it had reached a similar agreement with the US and promised to ease pending legal challenges it had mounted against the US decision last year in the World Trade Organisation.

Canadian Prime Minister Justin Trudeau told reporters that the normalisation of trade relations with the US was “pure good news”. He said the lifting of the tariffs could help clear the the United States-Mexico-Canada Agreement, which was reached late last year, get ratified. “We are very optimistic we will be able to move forward in coming weeks,” Trudeau added.

Canada and Mexico had refused to ratify the new trade agreement, the successor to the current North American Free Trade Agreement, with the restrictions in place. It was signed in November. American legislators of both parties had also insisted that tariffs on steel and aluminium must be lifted before votes would be held.

Trump had cited a national security threat when he imposed tariffs of 25% and 10% on steel and aluminium imports last year. Canada and Mexico, along with a number of US legislators, had asked why the Trump administration considers allies a threat. Canada then implemented retaliatory tariffs of 25% on a host of steel and aluminium products and 10% on goods, including pizza, quiche, whiskies, toilet paper and inflatable boats, from July. Many of products were chosen for their political rather than economic impact. </s> WASHINGTON/PARIS (Reuters) - Canada and Mexico retaliated against the United State’s decision on Thursday to impose tariffs on steel and aluminium imports and the European Union had its own reprisals ready to go, reigniting investor fears of a global trade war.

The tariffs, announced by U.S. Commerce Secretary Wilbur Ross in a telephone briefing on Thursday, ended months of uncertainty about potential exemptions and suggested a hardening of the Trump administration’s approach to trade negotiations.

The measures, touted by President Donald Trump in March, drew condemnation from Republican lawmakers and the country’s main business lobbying group and sent a chill through financial markets.

The Dow Jones Industrial Average .DJI lost 1 percent and the S&P 500 .SPX shed around 0.66 percent. Shares of industrial heavyweights Boeing (BA.N) fell 1.7 percent and Caterpillar (CAT.N) 2.2 percent.

A 25 percent tariff on steel imports and 10 percent tariff on aluminium imports will be imposed on the EU, Canada and Mexico from midnight (0400 GMT on Friday), Ross told reporters.

“We look forward to continued negotiations, both with Canada and Mexico on the one hand, and with the European Commission on the other hand, because there are other issues that we also need to get resolved,” he said.

Canada and Mexico, embroiled in talks with the United States to modernize the North American Free Trade Agreement (NAFTA), responded swiftly.

Canada, the largest supplier of steel to the United States, will impose tariffs covering C$16.6 billion ($12.8 billion) on imports from the United States, including whiskey, orange juice, steel, aluminium and other products, Canadian Foreign Minister Chrystia Freeland said.

“The American administration has made a decision today that we deplore, and obviously is going to lead to retaliatory measures, as it must,” Prime Minister Justin Trudeau said at a news conference with Freeland.

Mexico announced what it described as “equivalent” measures on a wide range of U.S. farm and industrial products.

The measures, which target pork legs, apples, grapes and cheese as well as steel and other products, will be in place until the U.S. government eliminates its tariffs, Mexico’s Economy Ministry said.

The S&P 500’s packaged foods and meats industry sub-index .SPLRCFOOD fell 2 percent, with shares of meat producer Tyson Foods Inc (TSN.N) falling 4 percent, Campbell Soup Co (CPB.N) 2.5 percent and spice maker McCormick & Co Inc (MKC.N) 3 percent.

The Mexican peso MXN= dropped about 1 percent and the Canadian dollar CAD= shed about 0.6 percent. At its low, the peso was at its weakest against the dollar in nearly 15 months.

The EU threatened tariffs on Harley Davidson motorcycles and bourbon, measures aimed at the political bases of U.S. Republican legislators. Shares of Harley-Davidson Inc (HOG.N) fell 2.17 percent and Brown-Forman Corp (BFb.N), maker of Early Times and other bourbon brands, lost 2.1 percent. EU members have given broad support to a European Commission plan to set duties on 2.8 billion euros ($3.4 billion) of U.S. exports if Washington ends tariff exemptions. EU exports potentially subject to U.S. duties are worth 6.4 billion euros ($7.5 billion).

“It’s entirely up to U.S authorities whether they want to enter into a trade conflict with their biggest partner, Europe,” France’s Finance Minister Bruno Le Maire said after meeting with Ross on Thursday.

U.S. Chamber of Commerce President Tom Donohue warned in a letter seen by Reuters to the body’s board that current trade policies could threaten “economic progress” and cause the loss of more than 2 million jobs, mostly in states that voted for Trump and Republican candidates.

The tariffs are part of Trump’s effort to protect U.S. industry and workers from what he described as unfair international competition, a key theme of his “America First” agenda.

Temporary exemptions were granted to a number of nations and permanent ones to several countries including Australia, Argentina and South Korea. U.S. trading partners had demanded that the exemptions be extended or made permanent.

The tariffs are aimed at allowing the U.S. steel and aluminium industries to increase their capacity utilization rates above 80 percent for the first time in years.

Shares of U.S. Steel Corp (X.N) rose 1.7 percent, but AK Steel (AKS.N) fell 1.3 percent and Steel Dynamics Inc (STLD.O) shed 0.9 percent. Shares of Century Aluminum Co (CENX.O) jumped 3.3 percent but Alcoa Corp (AA.N) shed 0.9 percent.

The U.S. administration also launched a national security investigation last week into car and truck imports, using the same 1962 law it has applied to curb incoming steel and aluminium.

“The Trump administration seems to regard overt threats, including tariffs and repudiation of previous agreements, as a key element for gaining leverage in trade negotiations,” said Eswar Prasad, a former head of the International Monetary Fund’s China division and now a professor at Cornell University.

Prasad warned that the United States was doing so at the cost of alienating key allies and undercutting broad international pressure on China to change its trade and economic practices.

Ross himself heads to Beijing on Friday where he will attempt to get firm deals to export more U.S. goods in a bid to cut America’s $375 billion trade deficit with China.

The Trump administration has demanded that Beijing make concessions and threatened to punish it for allegedly stealing U.S. technology by imposing tariffs on $50 billion of imports from China.

While China is seen at more risk from a trade war as its exports are larger than its imports from the U.S., the operations of American companies in China make substantial sales there, which could be hit by any turn in sentiment. ($1 = 0.8575 euros) </s> Trump’s announcement that he will impose stiff tariffs on imported steel and aluminum has upended political alliances on Capitol Hill.

President Donald Trump listens during a meeting with steel and aluminum executives in the Cabinet Room of the White House, Thursday, March 1, 2018, in Washington. Trump’s announcement that he will impose stiff tariffs on imported steel and aluminum has upended political alliances on Capitol Hill. (AP Photo/Evan Vucci)

President Donald Trump issued a pair of early-morning tweets that say American tariffs on imported steel and aluminum will only come off if there’s a new NAFTA agreement that’s fair to the United States.

The president also wrote that Canada must treat U.S. farmers better and Mexico must do more to stop drugs from getting into the United States.

Related: Trump promises big tariffs on steel, aluminum; impact on Canada still unclear

The president has invoked national security as the reasons for imposing tariffs of 25 per cent and 10 per cent, respectively, on all imported steel and aluminum.

But the Trump administration is coming under political pressure at home to exclude Canada, which is the largest source of imported steel and aluminum to the United States.

His administration is in the midst of renegotiating the North American Free Trade Agreement, which covers trade between the United States, Canada and Mexico.

Related: Trudeau sounds alarm bell as U.S. inches toward tariff war

Like us on Facebook and follow us on Twitter. </s> Trump lifts tariffs on steel from Mexico and Canada, delays auto tariffs

WASHINGTON — Bogged down in a sprawling trade dispute with U.S. rival China, President Trump took steps Friday to ease tensions with America’s allies — lifting import taxes on Canadian and Mexican steel and aluminum and delaying auto tariffs that would have hurt Japan and Europe.

By removing the metals tariffs on Canada and Mexico, Trump cleared a key roadblock to a North American trade pact his team negotiated last year. As part of Friday’s arrangement, the Canadians and Mexicans agreed to scrap retaliatory tariffs they had imposed on U.S. goods.

“I’m pleased to announce that we’ve just reached an agreement with Canada and Mexico, and we’ll be selling our product into those countries without the imposition of tariffs, or major tariffs,” Trump said in a speech to the National Association of Realtors.

In a joint statement, the U.S. and Canada said they would work to prevent cheap imports of steel and aluminum from entering North America. The provision appeared to cover China, which has long been accused of flooding world markets with subsidized metal, driving down world prices and hurting U.S. producers. The countries could also reimpose the tariffs if they face a “surge” in steel or aluminum imports.

In Washington, some were urging Trump to take advantage of the truce with U.S. allies to get even tougher with China.

“China is our adversary,” said Sen. Ben Sasse, R-Neb. “Canada and Mexico are our friends. The president is right to increase pressure on China for their espionage, their theft of intellectual property, and their hostility toward the rule of law. The president is also right to be deescalating tension with our North American allies.”

Earlier Friday, the White House said Trump is delaying for six months any decision to slap tariffs on foreign cars, a move that would have hit Japan and the Europe especially hard.

Trump still is hoping to use the threat of auto tariffs to pressure Japan and the European Union into making concessions in ongoing trade talks.

“If agreements are not reached within 180 days, the president will determine whether and what further action needs to be taken,” White House press secretary Sarah Sanders said in a statement.

In imposing the metals tariffs and threatening those on autos, the president was relying on a rarely used weapon in the U.S. trade war arsenal — Section 232 of the Trade Expansion Act of 1962 — which lets the president impose tariffs on imports if the Commerce Department deems them a threat to national security.

But the steel and aluminum tariffs were also designed to coerce Canada and Mexico into agreeing to a revision of North American free trade pact. In fact, the Canadians and Mexicans did go along last year with a revamped regional trade deal that was to Trump’s liking. But the administration had refused to lift the taxes on their metals coming into the United States until Friday.

The new trade deal — the U.S.-Mexico-Canada Agreement — needs approval from legislatures in the U.S., Canada and Mexico. Several key U.S. lawmakers were threatening to reject the pact unless the tariffs were removed. And Canada had suggested it wouldn’t ratify any deal with tariffs still in place.

Thomas Donohue, president of the U.S. Chamber of Commerce, said the lifting of the tariffs “will bring immediate relief to American farmers and manufacturers. Critically, this action delivers a welcome burst of momentum for the USMCA in Congress.”

Canadian Prime Minister Justin Trudeau credited his government for holding out to get the tariffs removed.

“We stayed strong,” he said. “That’s what workers asked for. These tariffs didn’t make sense around national security. They were hurting Canadian consumers, Canadian workers and American consumers and American workers.”

Trump had faced a Saturday deadline to decide what to do about the auto tariffs.

Taxing auto imports would mark a major escalation in Trump’s aggressive trade policies and is expected to meet resistance in Congress. Last year, the United States imported $192 billion worth of passenger vehicles and $159 billion in auto parts.

“I have serious questions about the legitimacy of using national security as a basis to impose tariffs on cars and car parts,” Sen. Chuck Grassley, R-Iowa, said in a statement. Grassley, who chairs the Senate Finance Committee, is working on legislation to scale back the president’s authority to impose national security tariffs.

The White House said that Commerce Secretary Wilbur Ross has determined that imported vehicles and parts are a threat to national security. Trump deferred action on tariffs for 180 days to give negotiators time to work out deals, but threatened to impose them them if talks break down.

In justifying tariffs for national security reasons, Commerce found that the U.S. industrial base depends on technology developed by American-owned auto companies to maintain U.S. military superiority. Because of rising imports of autos and parts over the past 30 years, the market share of U.S.-owned automakers has fallen. That has caused a lag in research and development spending which is “weakening innovation and, accordingly, threatening to impair our national security,” the statement said.

The market share of vehicles produced and sold in the U.S. by American-owned automakers, the statement said, has declined from 67% in 1985 to 22% in 2017.

But the statistics don’t match market share figures from the industry. A message was left Friday seeking an explanation of how Commerce calculated the 22%.

In 2017, General Motors, Ford, Fiat Chrysler and Tesla combined had a 44.5% share of U.S. auto sales, according to Autodata Corp. Those figures include vehicles produced in other countries.

It’s possible that the Commerce Department didn’t include Fiat Chrysler, which is now legally headquartered in The Netherlands but has a huge research and development operation near Detroit. It had 12% of U.S. auto sales in 2017.

The Commerce figures also do not account for research by foreign automakers. Toyota, Hyundai-Kia, Subaru, Honda and others have significant research centers in the U.S.

Meanwhile, Trump is locked in a high stakes rumble with China. The U.S. accuses Beijing of stealing trade secrets and forcing American companies to hand over technology in a headlong push to challenge American technological dominance. The two countries have slapped tariffs on hundreds of billions of dollars of each other’s products. Talks broke off last week.

Paul Wiseman, Tom Krisher, Kevin Freking And Rob Gillies are Associated Press writers.
The United States lifts tariffs on steel and aluminum from Canada and Mexico.