Madam Chairman, I am pleased to have the opportunity to rise once more to address the immensely important issue of our softwood lumber trade with the United States.
The restrictions in the United States creates an immense impact on the industry and on all Canadians. They are of particular interest and concern to British Columbia. Softwood lumber is more than a $10 billion export industry and almost half of that lumber comes from British Columbia. As we have heard, 15,000 jobs have already been compromised in British Columbia and many more across the country. One million jobs across Canada are related to the forest products industry in some way. These countervailing duties are also having an impact on federal and provincial revenues.
We have to look at the motivation for the countervail action in the United States. The motivation by the American industry is simply protectionism. It wants protection for its industries. What is our motivation? Our motivation is free trade which has been our motivation all along. It is why we did not seek to renegotiate the softwood lumber agreement when it expired at the end of April. We have been working toward free trade.
In addition to the many important aspects that have been raised in this special debate this afternoon, let me briefly mention what I would see as the four key approaches of the government together with other governments and industry in Canada.
The first approach would be strength in unity. Since I have been in the House, the Minister for International Trade has been speaking publicly on a weekly basis and working across the country to ensure that we do not separate interests across Canada by province or by industry against industry. Unity and the strength that comes from unity has been the byword and the underlying fundamental strength of this approach, and it is holding and it is working. In fact if it does not work and we do not hold together then we will fail against this challenge. This unity is provincial governments to provincial governments, all provinces to the federal government and governments with industry. That is immensely important.
Industry has not had a difficult time. It is facing different circumstances across the country but also within any one province it has differences but it is holding together and it is supporting this strength in unity toward free trade.
Our second approach is to pursue every legal avenue and every available forum to challenge these countervail duties and these false allegations.
The first issue is around subsidy. As we have heard over and over again, Canada has won this challenge many times over the last 20 years in independent international tribunals. There is no subsidy.
In 1994, after winning this issue again, $1 billion in improperly collected countervail duties was returned to Canada and Canadian industries. Here we go again. There is no subsidy. Our differences in forest practices and the way we manage our forests in the two countries has led to some confusion perhaps but the rulings are absolutely clear. Our stumpage system and crown management system on public lands and public forests is based on sound forest management practices that protect the environment and create a sustainable flow in managed forests so that this is a sustainable industry into the future.
Subsidies, no way. It has been proven over and over again. What is the 19.3% interim countervailing duty based on? In this same time the price of lumber in the U.S. market has gone up 15%. How could there be a 19.3% entry. Moreover, it is calculated on a quarter to quarter basis rather than on an annual basis against the same quarter for the previous year which would have been the accurate calculation. The calculation is done by using the first milled price, which the calculation should be based on, yet the 19.3% countervailing duty is being imposed against the entry price which includes the added value from Canadian manufacturers crossing the border.
This is patently unreasonable, unfair and contrary to international trade rules.
We have looked at U.S. laws but U.S. laws keep changing. However time and again we have been told that this is clearly against international trade rules. The Byrd amendment that people have talked about has, thank goodness, been suspended by the president in response to the concerns expressed by Canadians, by our minister, by our Prime Minister, by our interparliamentary engagements, including members of the opposition to the president. We are being listened to.
What about the claim that Canada's log export restrictions are subsidies? The WTO has already ruled that those restrictions are not subsidies.
The U.S. law changed since the last ruling to prohibit the reimbursement of Canadian companies for improperly claimed subsidies. As we have heard, this is being challenged by Canada at the WTO and we will fight that to the end.
We will also fight in the U.S. courts. When the department of commerce makes its final conclusions on this matter, if it continues to support this false claim of subsidy and harm, then we will challenge it in the U.S. courts. We have judicial review there. The prime allegations in a judicial review are patently unreasonable decisions by public authorities, and that is clear from all of the evidence that has come together. We have submitted hundreds of thousands of pages of documents showing this patently unreasonable action. We will win the day in the end but what does it do in the interim?
The third approach is to have discussion with the U.S. involving federal and provincial governments. The third series of these promising discussions wound up in New York this afternoon. They were held in Toronto two weeks ago and they have been held in Washington over the last three days. They have been promising enough that all parties are being advised by Canadian industry to continue in Vancouver in the next short while and later in Montreal. These discussions are going somewhere. They are working on common ground and leading to a better understanding of the differences in forest practices and market conditions in both countries.
That leads to our final approach, which is building relationships with our natural allies in the United States. It involves parliamentarians. We have heard from over 115 congressmen, member representatives as well as senators, who have come behind the Canadian position to support our just claims for free trade. We are making progress with home suppliers and homebuilders who are seeing their costs rise simply because a few lumber companies in the U.S. are looking for protectionism in the trade of lumber products.
We are also speaking to the American consumer more and more effectively. We are strengthening unity and litigating on every point to win our just claims of free trade at the end of the day. In the interim we are working on discussions between all levels of government, with parliamentarians and government officials in the U.S., and with the solid support of Canadian industry.
Finally, in our communications and dialogue, we are speaking directly to a whole range of allies, the most important of which is the American consumer and voter in the United States, to ensure their government lives up to its obligations to all Canadians to ensure free trade in softwood lumber.