Canada is ready to fight the softwood lumber tariffs possibly imposed by the United States, in front of the World Trade Organization, if there can’t be reached any negotiation settlement.
Trade Minister Chrystia Freeland said that the Canadian government is now taking a “two-track approach” -- pursuing a negotiated deal while preparing for any WTO fight, as reported by Bloomberg.
Last week, on Wednesday, the tariff standstill expired, which left the US lumber industry ready to begin the proceedings to add charges to Canadian lumber. The Canadian softwood lumber exports increased since the 2006 Softwood Lumber Agreement expired on the 12th of October 2015.
“We understand the way to get a great deal is to be prepared for the possibility there is no deal at all,” Freeland told lawmakers in Ottawa. “We want a good deal, not just any deal. And if we can’t achieve a negotiated agreement, Canada’s prepared to fight.”
Opposition lawmakers in the Parliament criticized Freeland for the failure to obtain a deal. She explained that the country isn’t necessarily facing a war trade, but is fighting the “current protectionist climate” in U.S. politics, while she added that a softwood lumber agreement is still possible.
According to Bloomberg, Freeland and her counterpart, U.S. Trade Representative Michael Froman, pledged last week to continue to work toward a “durable and equitable solution” despite failing to reach a deal before the tariff standstill expired. Freeland addressed a portion of her comments directly to U.S. officials, saying “I want to assure them we are negotiating in good faith” while preparing for any WTO dispute.
The US Lumber Coalition said in a statement they released last week, that any industry complaint will be filled at the right time. The coalition added that the industry has “no choice” but to press the U.S. government to act against Canadian softwood and that any new deal should maintain Canadian exports at or below an agreed U.S. market share.
Moreover, BC producers want to choose between an export tax model and a restriction on volumes, which was also present in the previous Softwood Lumber Agreement.