Industryweek 21190 Freeland Chrystia G Fionagoodall

Canada to US: Play Nice With One of Your Biggest Customers

April 26, 2017
Trump set off a trade fight with Canada this week by imposing tariffs of as much as 24% on Canadian softwood lumber as disputes loom over the North American Free Trade Agreement and dairy products.

Canadian Foreign Minister Chrystia Freeland said she’s confident her country will prevail over the U.S. in a lumber dispute and urged President Donald Trump’s administration to uphold free trade.

Freeland said she raised trade matters with first daughter Ivanka Trump on the sidelines of a conference in Berlin on Tuesday, though it wasn’t the focus of the meeting. The U.S. needs to recognize the importance of the two nations’ $500 billion in annual commerce, she said.

“I would say to my American friends: Be nice to your clients,” Freeland said in a Bloomberg Television interview in Berlin on Wednesday. “We work hard at our relationship with you guys, and I think it’s in the interest of the United States to keep the relationship strong as well.”

Trump set off a trade fight with Canada this week by imposing tariffs of as much as 24% on Canadian softwood lumber as disputes loom over the North American Free Trade Agreement and dairy products. Canadian Prime Minister Justin Trudeau said U.S.-Canada trade is mutually beneficial and criticized “baseless allegations” on lumber in a subsequent phone call with Trump.

"Unabashed Free Trader"

“I am an unabashed free trader and Canada is a trading nation,” Freeland said. “I know that’s not such a popular sentiment for governments to express.”

Though the lumber dispute dates back decades, Trudeau’s attempts to court Trump couldn’t prevent it from flaring up again -- a possible warning for other trading powers such as Germany as Chancellor Angela Merkel reaches out to Ivanka Trump as a conduit to her father.

“We really think that these allegations that our industry is being subsidized are wrong,” Freeland said. “We’re going to take it to court and we’re confident that, as has been the case every single time in the past, we’re going to win. In the meantime we continue to negotiate.”

Softwood Spat

The last softwood spat ran from 2001 to 2006.

“This isn’t an easy fix,” Derek Nighbor, chief executive officer of the Forest Products Association of Canada, told Bloomberg TV Canada Tuesday. He said Canada can’t appeal duties until they’re finalized early next year.

Freeland said she’s glad that Canada’s free-trade accord with the European Union, known as CETA, was completed before the U.K. leaves the EU. That means it’ll underpin future trade relations between Canada and the U.K., she said.

British leaders including Prime Minister Theresa May have told Canadian officials “they are extremely keen for CETA to be a floor of our economic relationship,” Freeland said. “That’s just going to be the start. We hope that we will be able to develop, when Britain is ready to come to the table, an even closer trading relationship.”

By Rainer Buergin and Matthew Miller

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