by Josh Wingrove and Andrew Mayeda

Justin Trudeau is taking new steps to stop steel and aluminum from being diverted through Canada’s borders to skirt tough U.S. levies. 

The prime minister unveiled the measures Tuesday after speaking the night before with U.S. President Donald Trump. The two leaders discussed “strong measures Canada is taking to address unfair trade in steel and aluminum,” according to a statement from Trudeau’s office Monday. Canada, the largest source of U.S. steel and aluminum imports, is seeking a permanent exemption from American tariffs.

Canada will undertake new border investigations and expand the powers of its border agency “to stop foreign exporters from avoiding duties meant to level the playing field,” according to a second statement Tuesday morning. “These past few days, we’ve looked at strengthening the measures that we already have in place because it’s important that we not be taking in dumped steel from around the world,” Trudeau told reporters in Ottawa. 

Canada and Mexico initially won indefinite exemptions from new U.S. tariffs of 25% on steel and 10% on aluminum, on the condition they do more to stop transshipment. Trump has since said that exemption will expire May 1, but could still be extended.

The countries remain engaged in talks on the North American Free Trade Agreement, with the next round expected in April and both leaders sounding more optimistic. U.S. Commerce Secretary Wilbur Ross warned Tuesday that time was running short to reach a deal before a Mexican election on July 1 and U.S. midterms later this year. U.S. Trade Representative Robert Lighthizer has expressed a similar urgency. 

“Ambassador Lighthizer has some optimism that a transaction could be put together. The political calendar is very tricky there,” Ross said in a Fox Business interview Tuesday morning. “So as you move very far into this year, the political calendar makes it very hard for something as big and as complex as NAFTA to get done.”

Trudeau told Trump on Monday he hoped to “conclude a modern, mutually beneficial NAFTA as soon as possible.”

To contact the reporters on this story: Josh Wingrove in Ottawa at [email protected];

Andrew Mayeda in Washington at [email protected]

To contact the editors responsible for this story: Theophilos Argitis at [email protected]

Chris Fournier, Stephen Wicary

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