WTO complaint and proposed U.S. newsprint duties fuel trade battle On January 10, the Feds made public a World Trade Organization complaint over the United States’ trade remedy measures, arguing its use of anti-dumping and anti-subsidy duties violates global trade rules. The 32-page complaint is Canada’s most recent attempt to counter import duties imposed by the U.S., particularly on Canadian softwood lumber products. Its publication came just hours after the U.S. announced countervailing duties of 0.65 to 9.93 per cent on Canadian exports of uncoated groundwood paper or newsprint. The disputes are occurring in the midst of difficult NAFTA renegotiations between Canada and the U.S. Canada is the largest exporter of newsprint in the world. According to the U.S. Department of Commerce, Canada exported more than $2.4 billion worth of newsprint to the U.S. in 2016. “[This] preliminary decision allows U.S. producers to receive relief from the market distorting effects of potential government subsidies while taking into account the need to keep groundwood paper prices affordable for domestic consumers,” stated U.S. Commerce Secretary Wilbur Ross. Derek Nighbor, CEO of Forest Products Association of Canada, called the duties “unjustified and protectionist in nature.” “These rates...on uncoated groundwood paper represent the third action that stands to hurt hard-working men and women in our mill communities across Canada,” he said. An overall tariff of 6.53 per cent has been levied on about 25 Canadian plants. Kruger faces a preliminary duty of 9.93 per cent, while the duty against Catalyst Paper is 6.09 per cent, 4.42 per cent for Resolute, and 0.65 per cent for White Birch. Many argue the proposed U.S. duties on newsprint will have a severe impact beyond the national level. “This decision will not only affect pulp and paper producers but also their entire supply chain,” said Dennis Darby, Canadian Manufacturers & Exporters president and CEO. “There are 600,000 workers in the newspaper publishing sector as well as the commercial printing sector who are at risk,” said Resolute spokesperson Seth Kursman, as reported by The Canadian Press. “And we know as a manufacturer of this product that if demand continues to go down over time, this has an impact on our ability to operate facilities.” Canada will host the next round of NAFTA talks on January 23 to 28; until then, the industry must wait to see how the conversation plays out. As Resolute president and CEO Richard Garneau puts it, “Free trade between the two nations is in the best interests of both countries and their shared economic prosperity.”
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