Fighting back over softwood
Ottawa mulls its options in lumber dispute
WASHINGTON — The Canadian government is threatening multiple trade actions against the United States in retaliation for duties on softwood lumber, demanding a long-term deal without which several American industries could soon be targeted.
One threat was to be announced publicly in a letter Friday. Another, more multi-faceted measure is being considered.
Prime Minister Justin Trudeau will launch the first salvo in a letter to B.C. Premier Christy Clark, informing her that he’s seriously considering her request for a ban on thermal coal exports and that it’s being explored by federal trade officials.
The second threat: Possible duties against Oregon industries. That’s the home state of a Democratic senator, Ron Wyden, who has been a hardliner on the lumber dispute.
The Canadian government has found several Oregon business-assistance programs it says may constitute illegal subsidies. It’s considering a process that could lead to retaliatory duties on imports from that state’s products, such as plywood, flooring, wood chips, packaging material and wine.
Two government sources insist the threat has nothing to do with U.S. President Donald Trump; they say it’s a one-off, specific action related to one dispute, and one Democratic senator in one state.
They say a long-term deal on softwood lumber would be the best way to prevent the dispute from escalating.
“We hope we don’t have to act,” said one source, speaking on condition of anonymity in order to discuss matters not yet made public. “We hope this dispute can be resolved.”
The course of action being reviewed by the Canadian government is similar to the process used in the U.S. that slapped a 20-per-cent duty on northern lumber. It involves a request to the Canada Border Services Agency to study illegal subsidies in Oregon, a process that would take several months.
The government says it has zeroed in on nine programs in Oregon that assist businesses, primarily in lumber.
They include: The Oregon Underproductive Forestland Tax Credit, the Oregon Forest Resource Trust, the Oregon Tree Farm Program, the Pacific Forest Trust, property tax exemptions for standing timber, a small winery tax exemption program and other tax credits.
“It’s a real thing. Our officials have already been looking at this,” said one government official familiar with the plan. ”Wyden has been a chief proponent for years of the baseless and unfounded claims against the Canadian softwood lumber industry.”
Another official said there’s no intention of changing the low-drama, co-operative posture Trudeau has taken toward the White House: ”This is not about the president. This is about the state... The strategy (with Trump) is still one of positive engagement...
”(But) we still have to respond to these issues as they come.”