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Blew It Again Reuters via Yahoo 'reports' below.\ Hard to believe they didn't ask Bush
Inc. why |
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Canada, U.S. See Common Ground for
Lumber Deal
7/29/03 MONTREAL (Reuters) - Canadian and U.S. government officials have agreed on a number of undisclosed points that could lead to the end of a bitter trade dispute over softwood lumber, a Canadian official said on Tuesday. "We have found common ground on a possible agreement, on the parameters, but that's between the negotiators, and we're consulting with the industries of both countries before moving forward," Sebastien Theberge, a spokesman for Trade Minister Pierre Pettigrew, told reporters. "It's a draft agreement. The ministers have not been involved yet." U.S. industry representatives were scheduled to meet on Tuesday with Commerce Department officials to discuss the latest ideas being floated by Ottawa and Washington. Lumber industry sources said if the U.S. producers did not reject the new plan outright, another round of difficult negotiations lay ahead, and a key Canadian official cautioned against predicting that the trade fight would soon end. "It is extremely premature for anyone to speaking of a final agreement. There is a lot of work to be done," British Columbia Forest Minister Michael de Jong told reporters from Kelowna, B.C. The two countries are trying to resolve their perennial disagreement over the $6 billion in annual exports of Canadian softwood lumber, such as pine and spruce, to the United States for use in the construction market. The United States, charging the Canadians were selling their lumber at below-market prices, had imposed 27.2 percent duties. Canada denies its lumber is subsidized or dumped on the U.S. market at unfairly low prices. Theberge was unwilling to talk about reports that quotas for lumber entering the United States could be reintroduced, although another Canadian source said this was not likely to win approval. Industry sources on both sides of the border said the two governments were suggesting that Canadian producers could supply up to 30 percent of the U.S. market duty-free, following which steep and graduated duties would be applied. A Canadian official met with a U.S. Commerce Department official last week, and Theberge said efforts to reach a solution had reached a critical stage. According to industry sources, the proposal would return to a quota system for lumber trade by allowing up to about 16.8 billion board feet of Canadian wood to enter the United States duty-free each year. That would be about 30 percent of the U.S. market, down from Canada's recent share of about 34 percent. An export tax of $50 per 1,000 board feet, to be collected by the Canadian federal government, would apply to wood beyond the 30 percent market share. But that tax would rise incrementally until it reached $125 for wood beyond 32.5 percent market share, according to the sources. Funds collected by the U.S. government related to the 27.2 percent import duties ultimately would be split in half by the two countries, industry sources said. One source, who asked not to be identified, questioned the legality of returning any of those funds to Canada, since they are controlled by the U.S. Treasury. Users of wood, including homebuilders and retailers, already were complaining about a possible return to quotas that could raise the cost of lumber. De Jong said the mechanism for determining the quotas as "significantly different" than those used in the U.S.-Canada softwood lumber accord that expired two years ago and sparked the current trade fight. Before approving the deal Canada's provinces -- some of which oppose any quota deal -- would have decide how the quotas would be divided among them, and then develop systems to divide the quotas among individual producers, de Jong said. |