While members of B.C.’s legislature play their political games, Canada and the U.S. are involved in a softwood-lumber war that could cost the provincial economy dearly. Get the partisan wrangling over quickly, and get on with looking after the interests of the province.
The U.S. Department of Commerce increased tariffs this week on Canadian softwood lumber, adding to countervailing duties applied in April. That means the industry faces average duties of about 27 per cent, although the rates vary by company, depending on the price each company sets.
This is painful for B.C. — the forestry industry is the largest sector of the province’s economy. The No. 1 market for B.C. lumber is the U.S. — $4.6 billion worth in 2016. Punitive tariffs imposed by the U.S. cut into profits and bring about job losses here.
The U.S. cannot produce enough lumber for its own needs, and relies on Canada for about 27 per cent of the wood used for construction. Despite that dependence, the lumber trade between the two countries has often been marked by hostility and tension. A true British Columbian cannot utter the words “softwood lumber” without adding the word “dispute” to the conversation.
And with good reason. Since 1982, softwood-lumber exports to the U.S. have been the focus of five rounds of litigation between Canada and the U.S., resulting in three trade agreements. The last one was implemented in 2006 and expired in October 2015, with the provision the U.S. could not take action against Canada for a year after the agreement expired.
The disputes are the result of complaints from the U.S. lumber industry, which maintains that Canada unfairly subsidizes the forestry industry and keeps prices in the U.S. too low. International tribunals have consistently stated this is not the case, or that if there are Canadian subsidies, they have a negligible effect on the market.
Canada will likely win this round, too, but it will be a long battle, and a costly one. When a trade dispute over softwood erupted in 2001, B.C. lost 15,000 forestry-industry jobs in a matter of months.
The softwood issue got several passing mentions in the legislature this week, but it was largely finger-pointing. NDP Leader John Horgan listed the softwood lumber agreement among the “messes” that were “the creation of 16 years of B.C. Liberal governments.”
That elicited this response from Forests and Lands Minister John Rustad: “We heard something historic today. The leader of the opposition talked about softwood lumber in the legislature for the first time in four or five years.”
Provincial officials don’t have a lot of control over what happens with the softwood dispute — it’s a fight taking place mainly at the federal level — but B.C. has a huge dog in this fight. It’s quite clear the B.C. Liberals will fall this week to be replace by the NDP-Green coalition.
It’s a process that must run its course, but then provincial needs should take place over partisan priorities. When the dust is settled, they should form a united front on the softwood-lumber issue.
Our politicians should be working together to protect an important sector of our economy, rather than booting it about like a soccer ball as they strive to score points against their opponents.
