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Canada challenges U.S. tariff system

12 January 2018

The US called the claims "unfounded", with its Trade Representative Robert Lighthizer saying: "Canada's new request for consultations at the WTO is a broad and ill-advised attack on the US trade remedies system".

"These rates tabled lby the US on uncoated groundwood paper represent the third action that stands to hurt hard working men and women in our mill communities across Canada", says Derek Nighbor, CEO, Forest Products Association of Canada.

The 32-page complaint challenges Washington's use of anti-dumping and countervailing duties, arguing it goes against WTO rules. There are 122 instances involving various countries listed in the WTO filing, which dates to December.

The irony here is that Canada is making the same complaint about the United States. We know that when unbiased entities review these unfair trade practices, they have found in Canada's favour.

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"For example, if the USA removed the orders listed in Canada's complaint, the flood of imports from China and other countries would negatively impact billions of dollars in Canadian exports to the United States, including almost $9-billion in exports of steel and aluminum products and more than $2.5-billion in exports of wood and paper products", Mr. Lighthizer said.

Warner believes that the Canadian government may be playing to a domestic audience in demonstrating that it is not only being "very assertive" in addressing trade disputes, but that it is also trying to "embarrass the Americans" before the world by citing nearly 180 trade breaches over two decades against other countries listed on 24 pages of Canada's 32-page complaint before the WTO.

Canada cites 188 examples of USA trade remedies in its claims, but only a handful involve US trade action against Canada and another 33 countries are mentioned.

The Canadian government feels this case could add weight to an existing complaint to the WTO over the duties Washington has levied on Canadian softwood.

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Critics have accused the Trump administration of wanting to hobble the WTO. But he questioned the strategic logic of antagonizing the Trump administration in the midst of NAFTA talks.

Anticipating an imminent USA retreat from NAFTA, the Canadian government has made a decision to go on the offensive in managing its trade relations with our Southern neighbor.

On Dec. 20, 2017 Canada filed a WTO complaint against the United States concerning its trade practices that Canada says violate global trade law.

With its WTO filing, Canada is forcing the United States to put its logic to the test.

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Trade relations between the countries have experienced some stumbling points as the sides are deadlocked in unsuccessful negotiations over NAFTA, the trade pact signed by the US, Canada, and Mexico in 1994 and based on the fundamental principle of tariff-elimination across North America. Such notice would not automatically mean a withdrawal: It would only give the United States the option to pull out after the six-month period elapses.

Canada challenges U.S. tariff system