- On 8–9 June the G7 met in Charlevoix (Canada); on the 9th Trump withdrew support for the final communiqué.
- A few days earlier, on 1 June, the US applied 25% tariffs on steel and 10% on aluminium from the EU, Canada and Mexico.
- The dispute opens a period of uncertainty: review contracts, prices and exposed supply chains.
The G7 summit was held on 8 and 9 June 2018 in La Malbaie, in Canada’s Charlevoix region. On Saturday 9, after leaving the meeting early to travel to Singapore, US President Donald Trump announced in a social media message that he had instructed his representatives not to endorse the joint communiqué.
The move came after Canadian Prime Minister Justin Trudeau, at a press conference, called the US tariffs “insulting”. Trump replied by criticising his remarks and the tariffs Canada applies to certain farm products. France and other observers even spoke of a “G6 plus one”, alluding to the US isolation on trade.
The background: the metal tariffs
On 1 June the United States began applying tariffs of 25% on steel imports and 10% on aluminium imports from the European Union, Canada and Mexico, which had until then been temporarily exempt. Washington justifies them on national security grounds, an argument its partners reject.
The European Union announced that it would turn to the World Trade Organization and prepare rebalancing measures. At a summit of allied countries, where common language on trade might be expected, the lack of consensus is an important political message: it shows that differences among Western partners go beyond a single sector. G7 summits do not take legally binding decisions, but their final communiqué serves as a political reference for cooperation among advanced economies, so the lack of agreement carries symbolic weight.
What it means for companies
For companies that export steel, aluminium or products incorporating them to the United States, the tariffs mean an additional cost that may erode margins or be passed on in prices. For those that import metals or use them in production, uncertainty extends to possible retaliation and to the reordering of trade flows. The episode took place amid a debate on the role of the World Trade Organization as arbiter of disputes, a system of multilateral rules on which companies that trade between countries depend for some predictability.
Beyond the sectors directly affected, a climate of trade confrontation between allies can influence investment and financial markets, and can affect currencies. That is why many companies follow developments closely, even if their products are not on the lists. For global trade, the underlying question is whether tariffs are a one-off measure or the start of a lasting change in the rules, and that doubt affects companies’ investment and location decisions.
What to review
It is useful to check whether contracts with customers and suppliers provide for who bears the new tariffs and how prices are adjusted when the customs regime changes. It is also worth reviewing tariff classification and the origin of products, which determine what duties apply.
If the company depends on a single supplier or a concentrated market, it is worth assessing alternatives and preparing scenarios. Your customs adviser can help identify your exposure. This information is general and is not advice. Exporting small businesses can lean on chambers of commerce, sector associations and trade promotion bodies, which usually offer up-to-date information on tariffs, rebalancing measures and internationalisation support.
When trade rules change, contract flexibility counts.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
