Ottawa warns of U.S. trade war

[pritchke]

[img]graemlins/headshake.gif[/img] More talk about the softwood lumber.

OTTAWA (CP) - Just a week before George W. Bush arrives for a feel-good visit with Paul Martin, Ottawa is talking tough about a possible trade war with the United States.

The federal government announced Tuesday that it is launching consultations with Canadians on possible retaliation over American duties.

It's all about the Byrd Amendment, which allows American companies to receive anti-dumping and countervailing duties collected from foreign competitors - such as those on softwood lumber.

The U.S. has failed to act on a World Trade Organization ruling that the amendment is illegal.

"Retaliation is not the preferred course of action, but this is about respecting international trade laws," Trade Minister Jim Peterson said from Brazil, where he is on a trade mission.

Don't place all the blame on Bush.
Martin has said he will raise key trade irritants such as softwood lumber and mad cow, but that the big problem lies in the U.S. Congress.

The pocket book hurts.
"But in a major way, we're in a legal fight for our lives. . . . The U.S. isn't going to respond to anything but economic pressure."

Ouch!!!!
On Aug. 31, the WTO ruled that Canada, Brazil, Chile, the European Union, India, Japan, Mexico and South Korea could retaliate by up to 72 per cent of the annual anti-dumping and countervailing duties on exports disbursed to U.S. companies in a given year.

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