U.S.-Canada dispute heats up

Softwood lumber, slated for export, is unloaded at Pacific Terminals in Vancouver, Canada. In a sign that the United States is taking a more aggressive stance in a long-running dispute over Canadian lumber imports, a U.S. trade official accused Canada on of failing to negotiate in good faith. (Associated Press / The Spokesman-Review)
Associated Press

WASHINGTON — In a sign the United States is taking a more aggressive stance in a long-running dispute over Canadian lumber imports, a U.S. trade official Thursday accused Canada of failing to negotiate in good faith.

While U.S. officials continue to support direct talks, “we hope the Canadians will end their strategy of frustrating meaningful negotiations so both sides can develop a durable solution to this 20-year problem,” said Richard Mills, a spokesman for the U.S. Trade Representative.

“Until then we will vigorously apply all of the trade remedies at our disposal,” including stiff tariffs imposed on Canadian lumber since May 2002, Mills said.

The comments came a week after a U.S. trade body agreed to comply with a NAFTA panel ruling concluding that Canadian imports are no threat to the U.S. softwood industry.

In a 5-1 vote, the U.S. International Trade Commission said last week that American companies are not threatened with material injury by Canadian imports — a position that runs contrary to U.S. policy and repeated statements by U.S. officials.

Commission members made clear in a statement they weren’t happy about their vote and were only complying with the Aug. 31 NAFTA ruling because of their respect for the NAFTA process.

On Thursday, Mills signaled that the trade commission vote was not the final word.

“The U.S. has documented that Canada unfairly subsidizes its lumber exports to the U.S., as independent trade panels have confirmed repeatedly,” he said. “It also has been demonstrated conclusively that Canadian producers have dumped lumber in the United States.”

After being told of Mills’ remarks, Jacqueline LaRocque, spokeswoman for Canadian Trade Minister Jim Peterson, said her country shared “the desire to see this dispute brought to an end once and for all.”

“Canada will continue to pursue its two-track approach of negotiation and litigation,” she said.

LaRocque noted that Canada has won a series of victories in recent months in proceedings before North American Free Trade Agreement panels and the World Trade Organization, including the Aug. 31 decision from a five-member NAFTA panel.

The panel directed the U.S. trade commission last month to rescind its justification for the average 27 percent tariffs imposed on Canadian lumber since 2002. The panel said the ITC had presented no new evidence to support earlier, rejected evidence that Canadian imports harmed U.S. producers.

Softwood lumber from pine, spruce and fir trees is used to build homes. In 2002, the United States imported about a third of its supply — nearly $6 billion — from Canada.

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