Canada continues to be a punching bag for Donald Trump and his cabinet as both the president and U.S. Commerce Secretary Wilbur Ross blasted Canadian trade policies on Tuesday.
While signing an executive order promoting agriculture in the U.S., Trump said Canada has been “very rough” on his country, and that Canadian politicians have held the upper hand with U.S. counterparts for quite some time.
“People don’t realize Canada’s been very rough on the United States. Everyone thinks of Canada being wonderful and civil. I love Canada,” Trump told a group of farmers and agriculture policy experts at the White House on Tuesday. “But they’ve outsmarted our politicians for many years, and you people understand that.”
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Trump was also asked if he feared a trade war with Canada after announcing tariffs of up to 24 per cent on Canadian lumber, with more expected later in June.
“No, not at all,” Trump said. “They have a tremendous surplus with the United States. Whenever they have a surplus, I have no fear.”
Meanwhile, Ross also took Canada to task during a press conference Tuesday.
“They are a close ally, they are an important ally, they are generally a good neighbour — that doesn’t mean they don’t have to play by the rules,” Ross told reporters at the White House. “Things like this I don’t regard as being a good neighbour — dumping lumber.”
Ross went on to point out the tariffs would likely be a negotiating tool in impending NAFTA talks.
“Everything relates to everything else when you are trying to negotiate,” Ross said. “What we had tried to do was to clear the air and get this dispute out of the way before the big NAFTA talks went on. That was not possible to achieve, and that’s why we went ahead and released the findings.”
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The countervailing duties on lumber are just the latest example of Trump’s administration targeting Canada in a series of increasing trade battles including complaints about Canada’s dairy industry.
“What’s provoked the disputes is the following: in Canada, the forests are owned by the individual provinces, and each of the provinces sets a charge for the loggers to use when they are taking trees down,” Ross said. “In the U.S., it’s all open market, it’s all market-based prices.”
READ MORE: Does Canada subsidize softwood lumber?
Duties will also be collected retroactively, Ross said, noting the U.S. will gather them for the previous 90 days. Canadian lumber exports are worth roughly $5 billion a year and will now be hit with about $1 billion in duties.
“It’s not a question of President Trump ‘messing’ with the Canadians,” Ross said, explaining his department’s decision. “We believe the Canadians violated legitimate practice.”
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Meanwhile, Canadian officials attempted to reassure the lumber industry, and have vowed to fight the decision by the U.S.
“The Government of Canada will vigorously defend the interests of the Canadian softwood lumber industry, including through litigation.”
Prime Minister Justin Trudeau said Tuesday that the Canada-U.S. relationship is bigger than any one trade irritant — and that Canada needs to impress upon the U.S. that both countries would suffer from a “thickening” border.
“We are tremendously interconnected in our economy with that of the United States, but it’s not just a one-way relationship,” Trudeau said during a press conference in Kitchener, Ont.
Canadian softwood lumber producers also shot back against the duties announced Tuesday by the Trump administration.
WATCH ABOVE: Canada ‘not a good neighbour’ when it comes to lumber, dairy says U.S. Commerce Secretary Wilbur Ross
“The fact is, Canadian lumber imports don’t pose a threat to the U.S. lumber industry,” said Susan Yurkovich, president of the BC Lumber Trade Council in a statement. “There is enough North American demand to grow the U.S. industry while also allowing Canada to supply its U.S. customers as we have been doing for decades.”
The Alberta Softwood Lumber Trade Council said arguments that claim Alberta’s timber pricing system is unfair, doesn’t take into account “many costs, including reforestation, land management, road building, environmental monitoring, and site reclamation that Canadian producers must pay.”
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Experts who spoke with Global News Monday say that softwood imports are not subsidized and timber auctions run by Canadian governments have changed to better reflect current market rates. Trade resolution panels from both the World Trade Organization and the North American Free Trade Agreement have found that Canadian softwood lumber production is not subsidized.
Despite the fact that neither lumber nor dairy are actually part of the current NAFTA agreement, Trump and his cabinet secretary have said it’s all part of the bigger issue — the renegotiation of the trade agreement between Canada, the U.S. and Mexico.
“Think about it. If NAFTA were functioning properly, you wouldn’t be having these kinds of very prickly, very unfortunate developments back-to-back,” Ross said. “So in that sense, it shows NAFTA has not worked as well as it should.”
WATCH: U.S. Commerce Sec. outlines Trump’s trade grievances against Canada on lumber
Perhaps unsurprisingly, U.S. lumber producers praised the decision by the Trump administration.
“Today’s ruling confirms that Canadian lumber mills are subsidized by their government and benefit from timber pricing policies and other subsidies which harm U.S. manufacturers and workers” said Cameron Krauss of the U.S. Lumber Coalition.
— With a file from Heide Pearson and the Canadian Press