Prime Minister Mark Carney sharply criticized steelmaker Stelco and its American parent company Cleveland-Cliffs on Tuesday, saying Ottawa is prepared to take legal action if the company fails to honour commitments made when its takeover by the U.S. firm was approved.
The comments came a day after Stelco Holdings announced it would lay off as many as 500 workers at its Hamilton and Lake Erie plants, citing pressure from the ongoing tariff dispute with the United States and weakened demand for steel.
Speaking from British Columbia, Carney said the layoffs represented a breach of legal obligations tied to the federal government’s approval of Cleveland-Cliffs’ acquisition of Stelco. As part of that approval, the company made binding five-year commitments to maintain existing levels of unionized employment in Canada.
“We were very disappointed at this decision by Stelco,” Carney said. “Our — my personal and our thoughts are with the workers and the families who have been betrayed by the company.”
He added that federal funding had been offered to the company and that Ottawa intends to hold Stelco to its earlier representations regarding employment levels. “We intend to use all powers that we have and pursue them to the full extent of the law,” Carney said.
Blame Placed on U.S. Tariffs
Carney linked the layoffs directly to tariffs imposed by the Trump administration, noting that Cleveland-Cliffs CEO Lourenco Goncalves had publicly applauded President Trump for imposing tariffs on steel and aluminum. The United States has placed a 50 per cent tariff on steel and aluminum imports globally, with no exemption for the integrated North American market that industry groups have said the sector relies on.
Stelco has said that some of its Canadian workers affected by the layoffs may be able to remain employed, a commitment Carney said the government would hold the company to.
Trade Tensions Continue to Escalate
The layoff announcement came as trade tensions between Canada and the United States continued to intensify. A new U.S. ban targeting certain alcoholic drinks, dairy byproducts and motorcycles took effect Tuesday at 12:01 a.m. Eastern time. Asked whether Canada would respond or escalate further trade measures, Carney said he had “never ruled anything out.”
U.S. senior trade adviser Peter Navarro had criticized Canada a day earlier, saying the country had failed to negotiate as aggressively as other nations facing U.S. tariffs and had instead relied on lobbyists in Washington. Carney, when asked to respond to Navarro’s remarks and to a separate claim by President Trump that Canada would soon apologize and sign a trade deal with Washington, said he had “no response,” before restating his government’s approach to trade negotiations.
Carney said Ottawa remains open to negotiating “in good faith” with Washington and believes a mutually beneficial trade arrangement respecting both countries’ sovereignty is still achievable. At the same time, he said Canada would continue pursuing trade relationships with other global partners and would seek foreign investment for domestic projects, describing interest from “a host of strong partners around the world who want to do more with Canada.”
Broader Economic Pressures
Carney said several industries in both Canada and the United States face medium-term competitive pressure due to the trade war, arguing that such sectors are “stronger together.” He said Canada would keep working with international partners on shared priorities including energy security, food security, information security and financial resilience.
He also rejected the suggestion that Canada’s trade strategy was shaped by the U.S. political calendar, and pointed to the high cost of living in the United States as an area where Canada could offer economic benefits to American consumers.
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