CANADIANS ISSUE POINTED PROTESTS AGAINST US LUMBER IMPORT RULING

CANADIANS ISSUE POINTED PROTESTS AGAINST US LUMBER IMPORT RULING

Canadian business and government circles reacted sharply to Monday's decision by the U.S. International Trade Commission to uphold an earlier ruling against alleged subsidized exports from Canada of softwood lumber.

Tom Hockin, Canada's trade minister, said the decision was "surprising and unreasonable," vowing to continue the fight through the binational panel dispute resolution process under the 1988 U.S.-Canada free-trade accord.By a 4-2 vote, the ITC declared that U.S. lumber firms are harmed by imports of "subsidized" Canadian softwood lumber, thereby maintaining special duties of 6.51 percent on more than US$3 billion worth of annual Canadian exports of lumber to the United States.

These shipments account for more than half of Canada's softwood lumber production. Canadian lumber exporters have an estimated 28 percent of the U.S. market.

In reaffirming a rigid stance, the ITC rebuffed a strongly worded ruling taken last July by a binational panel, which had told the ITC it had previously erred and urged it to reconsider.

Mr. Hockin said the dispute now returns to a binational panel, which has until Jan. 24 to respond.

"In the light of the panel's earlier decision that there was no evidence of injury, it is difficult to envisage how the ITC will try to justify this latest determination," he said.

Tom Buell, chairman of the Canadian Forest Industries Council of Vancouver, British Columbia, also was quick to criticize the latest development in a decade-old bilateral trade dispute.

"Over the dreary history of this case," he said, "the United States has demonstrated continued intransigence in the face of rulings by two binational panels that repeatedly have determined the case to be without foundation."

U.S. lumber interests argue that Canadian exporters are unfairly subsidized through low harvesting fees.

They further claim that British Columbia, the largest lumber producer in Canada, protects its sawmill industry by restricting most exports of raw logs.