B.C. is still paying the price despite rulings.
With impunity, the U.S. bureaucracy continues to inflict significant damage on B.C.’s economy.
Where is the voice for those living and working in what the current provincial government has termed “the heartland”?
Since 1986, B.C.’s lumber industry has been under attack by our American cousins, yet Ottawa remains silent.
During the past month or two, significant but not surprising determinations were announced in favour of B.C.’s lumber industries. These findings support the claim by many that the continuing litigation by the U.S. Coalition for Fair Lumber Imports is frivolous and vexatious.
On April 29, the North American Free Trade Agreement (NAFTA) panel, an adjudicating body, rejected the U.S. position and found there was no threat of potential injury to American softwood lumber producers.
They directed the U.S. International Trade Commission to recalculate its numbers using the appropriate formulas to support its position in clear language.
The U.S. commission has 90 days to carry out this directive and make its appeal. Over 23 years, the weight of judicial authority arising from this lengthy litigation leads me to conclude that the request will not be successful, and the matter should end there.
Unfortunately, there is provision for a further legal step – that of an extraordinary challenge, which, if pursued, could drag this affair on until 2007. The chances of the outcome being different are minuscule to non-existent. However, it does permit the punishment of the B.C. lumber industry to continue.
A second finding, by the U.S. Department of Commerce, was also made in Canada’s favour. The department is required by law to undertake an annual review of its May 2002 determination. It arbitrarily imposed an 18.9-per-cent countervailing tariff and a further 8.4-per-cent dumping duty that resulted in a total levy of 27.2 percent. U.S. Customs collected this cash as the Canadian product entered the United States.
The annual review resulted in these duties and dumping fees being tentatively reduced to 13.22 percent. It is expected that this level of commitment will be confirmed on December 7, 2004. Until this date, B.C.’s exports will continue to pay customs at a higher rate.
Subject to the coalition not pursuing an extraordinary challenge, these countervailing and dumping fees will be removed entirely if, in 90 days, the NAFTA panel finds, as expected, in favour of the Canadian position.
However, I fear, given a history like the Hatfields and McCoys, this lumber dispute will continue.
This dispute is no longer a “misunderstanding of fact” about how B.C.’s stumpage rates are established. It can only be seen now as vindictive on the part of the coalition, as ideologically driven by the American bureaucracy and political opportunism by the Bush administration.
Bush could lose this election by 100,000 votes, and the coalition’s lobby influences at least that number of votes.
This is about protecting American jobs in an age of globalization without regard for trade agreements. This is about the American presidential election and concern to stem the hemorrhaging of American jobs to foreign venues. This is about inefficient American lumber mills failing to compete in a global economy.
As a result, we can expect that there will be no serious consideration of this question by the Bush and the U.S. bureaucracy until 2005. In the meantime, the working folks in B.C. continue to pay the price.
B.C. forests cover 59 million hectares, and the province provides about $5 billion in softwood lumber sales to the U.S. This unnecessary litigation has cost $200 million in legal fees and has permitted U.S. Customs to collect $2.2 billion in duties to date.
These monies indirectly come from higher home prices in the United States and from the bottom line of B.C. softwood lumber firms. In large part, the lumber industry is what we do in British Columbia.
This is the moment when our elected representatives, particularly those ministers in the federal Liberal party, should be yelling out loud and long about this injustice. Unfortunately, there is nothing but silence. Prime Minister Paul Martin commented that he raised this issue with President Bush during the recent G8 meeting. Yet, once again, it would seem that his efforts were ineffectual.
The evidence is clear. The World Trade Organization and the NAFTA panels have repeatedly found that the American adjudicating bodies were biased and did not take an objective examination of the evidence in imposing these countervailing duties and dumping fees on B.C. businesses.
Bush, from media reports, is pressing hard for the support of NATO, the United Nations, Canada and other western countries to assist in the swamps of Mesopotamia. We have answered the call in Afghanistan. We have supplied significant naval assets as part of Operation Apollo in the seas off Saudi Arabia, the Indian Ocean and the Persian Gulf. Even still, we are not heard.
The steel, cattle and lumber industries all suffer from the policies of Bush, “the protectionist.”
We must have elected officials in the House of Commons who can and will effectively articulate the position of Canadians. This protectionist punishment cannot be allowed to continue.
Note: This article was originally published in 2005.
