It seems that Justin Trudeau’s visit to Washington won’t bring back to Canada the renewed Softwood Lumber Agreement. According to Vancouver Sun, free trade with the US in softwood lumber isn’t possible and neither is the renewal of the SLA, which managed to keep trade under control.
President Obama doesn’t want to keep the expired deal on the table, especially because of the election year. At the moment there are a lot of issues caused by the impact of the low Canadian dollar, which affects the US producers. But there is nothing to be done on Canada because of the trade litigation that doesn’t allow the US to impose tariffs on Canadian softwood lumber imports until October 2016.
A solution would be to extend the litigation trade period until a new SLA is signed, but the US Lumber Coalition asks the government to impose the new tariffs on Canadian softwood. New tariffs mean the damaging of the import duties, especially for BC. Between 2001 and 2006, when the SLA wasn’t renewed, the Canadian exporters paid $5 billion to the US, while the combination of duties summed 27% on Canadian softwood, as Vancouver Sun reports.
Canada has to think long term, even if a temporary solution would also solve the issues for the moment. The exports to the US have decreased since the US housing market started to recover and Canada has started to make new trades with China, in exports that reached 21% in 2011.
Thus, as policy analyst Naomi Christensen told Vancouver Sun, Canada should start diversifying their market because only this way they wouldn’t depend on the US anymore.
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