Canada seeks NAFTA arbitration in lumber dispute with US

MONTREAL: Canada has requested that its trade dispute with Washington over US duties imposed on softwood lumber go to arbitration under North American Free Trade Agreement ( NAFTA) rules.

Foreign Minister Chrystia Freeland submitted the request on Tuesday, several days before the resumption of talks on renegotiating NAFTA, the trade deal between the US, Canada and Mexico which President Donald Trump has attacked as the ‘ worst ever’ and threatened to scrap.

The US Commerce Department imposed countervailing duties from the start of November ranging from 3.34 per cent to 18.19 per cent on the price of Canadian lumber products, after concluding that the northern neighbor had unfairly subsidized and dumped product on the US market.

In 2016, the United States imported US$ 5.7 billion worth of softwood lumber from Canada, up from US$ 4.5 billion in 2015.

Canadian softwood lumber has been a source of conflict in US- Canadian trade for three decades and Canada has often won in arbitration under NAFTA’s rules.

Among other things, the Trump administration wants to eliminate NAFTA’s arbitration process.

Freeland’s action drew support from Canadian interest groups like the British Columbia Lumber Council.

“We will vigorously defend our industry against these unfair and punitive duties and expect to be successful in these appeals, as we have been in the past,” the council’s head, Susan Yurkovich, said in a statement.

Canada’s biggest private sector union, Unifor, also voiced support.

“These unjust and punitive duties must end,” it said in a statement. —

We will vigorously defend our industry against these unfair and punitive duties and expect to be successful in these appeals, as we have been in the past. Susan Yurkovich, British Columbia Lumber Council head