Canada Goes Toe-to-Toe With US Trade Policy

Canada Goes Toe-to-Toe With US Trade Policy

The reason Canada did this, says Boscariol, is in large part because of the softwood lumber, but by taking on the entire US trade remedies system, Canada is taking the position that the USA, as our most important customer, must be held to WTO rules when it imposes these anti-dumping and countervailing measures that hamper free trade.

Canada's filing of a complaint with the World Trade Organization over the United States' anti-dumping and anti-subsidy duties is "broad and ill-advised", U.S. Trade Representative Robert Lighthizer said.

Canada says the USA violated the WTO's Anti-Dumping Agreement, the Agreement on Subsidies and Countervailing Measures, the General Agreement on Tariffs and Trade 1994 and the Understanding on Rules and Procedures Governing the Settlement of Disputes.

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The 32-page complaint cites dozens of examples unrelated to Canada, including 122 cases where the United States imposed duties on foreign countries. The filing has potentially strengthened Canada's hand in the NAFTA renegotiations, all the while putting pressure on the the softwood lumber dispute, among others.

In doing so, President Donald Trump has reversed a policy favored by past presidents of relying on dispute resolution mechanisms in the WTO and existing agreements such as the North American Free Trade Act (NAFTA).

The complaint challenges the ways that the United States investigates products for subsidies and below-cost sales.

After reports Wednesday that Canada now considered it inevitable that Trump would try to withdraw the USA from the treaty, one Canadian official with knowledge of the NAFTA negotiation offered a more nuanced position in an email to the Post, saying, "it's not accurate to say we're convinced", but that there was "no question we think there's a chance it could happen".

The filing also complained about US treatment of export controls as well as the imposition of retroactive tariffs. "This is effectively Canada bringing a dispute on behalf of all exporters in the world - the Europeans, Japan, China - because they're making a systemic challenge". The United States strongly criticized the Canadian action on Wednesday, warning it will end up backfiring against Canada because, were it to succeed, it could lead to a flood of imports from China into the United States that would displace other countries' products.

He blasted Canada's move as a self-defeating one that will harm the interests of its own workers and businesses. The U.S. imports about $1.6 billion a year in Canadian newsprint.

Lighthizer questioned why Canada filed so many complaints that included other countries.

"If Canada loses Chapter 19, it would have to go to the WTO", said Warner.

Mr. Trump has repeatedly threatened to pull out of NAFTA - or at least trigger the withdrawal process to increase pressure on Canada and Mexico.

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