Trudeau, Trump talk Canada-U.S. trade disputes on sidelines of G7

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Prime Minister Justin Trudeau pulled aside Donald Trump at the G7 summit on Saturday to press him on bilateral trade disputes threatening Canada's steel, lumber and aerospace industries.

Mr. Trudeau used a lull on the final day of the summit for a 30-minute discussion with the U.S. President – a rare opportunity to bend his ear about increasing trade tensions.

"We talked about a broad range of issues, as happens every time I sit down with the President," Mr. Trudeau told reporters. "We talked about softwood lumber. We talked about our aerospace industry. We talked about steel and aluminum and the importance of the integration of our economies."

Mr. Trudeau is particularly worried about a pending analysis by the U.S. Commerce Department on the effects of imported steel and aluminum.

In late April, Mr. Trump signed a directive asking for a quick probe into whether imports of foreign-made steel threaten U.S. national security.

"The issue the PM raised [with regards to] steel ‎is around section 232 of the Trade Expansion Act and it specifically deals with national security," a senior Canadian official said. "Right now, we're on the list to be investigated, and we feel that it's not appropriate to be on that list as a close ally."

Mr. Trudeau wants Canada exempted from any U.S. decision to deter imports of steel and aluminum.

The official did not say what Mr. Trump told the Prime Minister but the President later issued a tweet, vowing to act if the Commerce Department rules in favour of U.S. steel and aluminum industries.

"I look forward to reading @commercegov 232 analysis of steel and aluminum – to be released in June. Will take major action if necessary," he tweeted.

U.S. Commerce Secretary Wilbur Ross, who will also be in overall charge of talks on the North American free-trade agreement, invoked Section 232 of the U.S. Trade Expansion Act to launch a probe of steel and aluminum imports.

U.S. steelmakers have argued that cheap steel imports are impacting the industry and undermining American jobs.

Mr. Trudeau also told the President about Canada's objections to a U.S. Commerce Department decision to investigate Montreal aerospace giant Bombardier. Boeing has said that Bombardier sold planes below cost in the U.S. and benefited unfairly from government subsidies.

The Commerce probe parallels an investigation by the U.S. International Trade Commission into allegations by Boeing that Bombardier sold 75 C Series planes to Delta Air Lines last year at below cost.

Canada has warned it could scrap plans to buy 18 Boeing Super Hornet fighter jets if Washington backed Boeing's claims.

The official did not say whether the President was sympathetic to the Prime Minister, who argued that Bombardier is a major employer of U.S. workers.

In his wrap-up news conference, the Prime Minister said that he and the President agreed that "we need to continue to keep working together constructively to amplify the success citizens have on both sides of the border."

A Canadian official said Mr. Trudeau did not discuss the coming NAFTA negotiations that will begin in late August. U.S. law prohibits a President from discussing trade pact details once a 90-day notice has been given to Congress.

However, Mr. Trudeau did urge the President for a quick resolution of the softwood-lumber dispute. The President responded that Canadian and U.S. negotiators should continue to work on a solution.

U.S. lumber companies oppose the import of softwood, claiming Canadian companies have an unfair advantage with their preferential access to Crown-owned lands with lower stumpage fees.

Canada-U.S. trade relations have turned chilly since Mr. Trump won the presidency on the promise of adopting an American First policy to protect the interests of U.S. companies.

On Sunday, German Chancellor Angela Merkel did not mention Mr. Trump by name, but said the days of Europe counting on others were "over to a certain extent."

"We have to know that we must fight for our future on our own, for our destiny as Europeans," she said.

With files from Reuters