Mr. Speaker, I am pleased to rise in the House to debate the issues put forward by the hon. member for Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques.
The member's motion on softwood lumber is timely and important for all Canadians. The Canada-U.S. softwood lumber dispute is ongoing and it continues to be our country's latest trade concern with our neighbour to the south.
Last week's decision by the U.S. department of commerce, while not surprising given its protectionist leanings, is punitive for our industry in terms of job loss and mill closures and for U.S. consumers who will pay needlessly high housing prices to cover unwarranted duties.
This dispute, the fourth in 20 years, directly impacts hundreds of thousands of Canadian jobs and many more indirectly. Over 300 Canadian communities are at least 50% dependent on a strong lumber industry and on positive softwood lumber trade relations with the United States. Almost one million Canadians' livelihoods, or one in 16 jobs, are related to the lumber industry. Canadians in these communities know first hand of the impact that the U.S. trade action has on our country's economy, on their individual communities and on their families at home.
I will speak today on what the Government of Canada has done to defend the interests of its industry and what it will do in the days ahead.
Since the U.S. lumber industry petitioned the U.S. department of commerce in April of this year alleging that our industry is subsidized and is dumping lumber into the United States, the government has responded forcefully and clearly that these allegations are false and not based in fact. During the past 20 years three previous cases have not been sustained. Once again these allegations will be refuted. Based on protectionist sentiments, the U.S. industry's trade action has brought uncertainty, mill closures, job loss, reduced exports and lost opportunities to Canada's lumber industry.
Having said this, let me say that we in Canada are not the only ones hurting. As a result of the U.S. trade action, American consumers are feeling the impact of a needless dispute. As a result of U.S. duties on our lumber, American consumers will have to pay higher lumber prices and, accordingly, increased housing costs. The United States will see reduced housing starts, the only shining light in a lagging economy, and a weakened ability of hundreds of thousands of Americans to buy a home.
What impact does this have on those who want to purchase a home, a couple's first home, let us say, or on those who are concerned about affordable housing? The coalition American Consumers for Affordable Homes and other housing groups in the United States estimate that 32% duties on Canadian lumber will needlessly raise housing costs by up to $3,000.
Incredibly, the levying of duties by the United States administration on Canadian producers will greatly hurt the U.S. public, who will have to pay up to four months' mortgage just to cover the cost of needless trade action against Canadian lumber producers. Ironically, in an attempt to satisfy big lumber interests in the United States, the U.S. department of commerce has indirectly hurt those who are bystanders in this trade dispute.
In the face of the trade action and the difficulties it causes on both sides of the border, I would like to congratulate the many Canadian interests that have stood together prior to the investigation and since the trade action began in April. Canadian lumber producers, the provinces and territories and the Government of Canada have met regularly to determine the next steps. They have worked in a united fashion and have indicated in clear terms that we will fight the U.S. trade action based on the merits of our case, a case that has been successful for Canada many times before.
I am proud to say that our government has been active in defending our interests and in leading the way forward. To those say “what more can we do?”, I will summarize what we have done already and outline what we can do together in the near future.
Our Prime Minister has frequently personally engaged President Bush on the trade dispute at every opportunity. As the Prime Minister said in the House today and as he has said repeatedly, he had the opportunity to raise this issue a week or so ago in Shanghai with President Bush and has committed to again in the next few days raise this issue with the U.S. president. Let there be no doubt that the Prime Minister is personally engaged in this issue in a most serious way and has repeatedly raised this matter with the American president.
Our Minister for International Trade has forcefully made our case and has engaged in high level discussions on numerous occasions with commerce secretary Evans and U.S. trade representative Bob Zoellick. In answering a question in the House today, my colleague the Minister for International Trade indicated that he had met with the new special representative, Marc Racicot, appointed by President Bush. He indicated that they met earlier today and that Mr. Racicot now knows in no uncertain terms from the Minister for International Trade just exactly what are the concerns of the Canadian lumber producers, the Canadian workers and the Canadian government in this dispute.
Our minister and officials have been holding regular federal-provincial meetings. I applaud the provincial governments for sticking together in tough times and for advancing our common interest with the Government of Canada.
In order to counter protectionist views, we have built alliances with U.S. consumer groups and with companies that are dependent on Canadian lumber. For example, Home Depot, the large U.S. lumber retailer, has been a great supporter of our position and has actively lobbied members of the U.S. congress on the need for free trade in softwood lumber. That is the best answer: free trade in softwood lumber. Home Depot was instrumental in the recent team Canada mission to Atlanta. It has been a key player in the United States, advocating for free trade and not for trade action.
In response to the U.S. allegations, the Government of Canada has filed over 250,000 pages of evidence refuting categorically U.S. industry allegations. We have helped individual companies prepare applications for exclusion from the countervailing duty investigation and recently submitted 334 applications to the U.S. department of commerce.
Our embassy in Washington and our consulates across the United States have been very active in lobbying decision makers and in educating the American public on the impact that duties will have on them, U.S. consumers. To date, some 115 members of congress have agreed with the position of the Government of Canada. As well, many articles supporting the Canadian position have appeared in U.S. newspapers.
This is a new phenomenon and a positive one compared to the last time we had this dispute with the United States. The American public and the American congress are more informed now and we are actively building and cultivating an alliance south of the border that supports us in arguing for free trade in softwood lumber. They just want their government to stand up to what it says it is and be a free trader in softwood lumber like it is when it chooses to be so in other commodities.
Canada's answer to the preliminary determinations of subsidy of the United States department of commerce and to its trade action has been to level the playing field so that big U.S. lumber does not rule the day. Our decision to challenge the United States on its protectionist softwood lumber rulings before the World Trade Organization is the best means of achieving success for our industry once again.
I know that we are challenging U.S. law and department of commerce rulings on five separate measures before the WTO. Our challenges are directly related to softwood lumber and I am pleased that the WTO has already ruled in our favour with respect to log export policy. In conjunction with a dozen other countries we are challenging another measure of U.S. legislation that impacts softwood lumber, the infamous Byrd amendment. While we are fighting the countervailing duty case on its merits, the Government of Canada in conjunction with the provinces is working to seek the individual exclusion of hundreds of Canadian companies from this trade action. Our government's success in having all of Atlantic Canada's producers exempted from the subsidy case is a recent victory that we hope to extend to the many Canadian producers that should not even be considered a part of the United States trade concern.
What are Canada's next steps? I agree with my colleague, the Minister for International Trade, and with the assessment of our industries and provinces that we should continue to fight the U.S. trade action with every single legal means at our disposal. Continued challenges before the WTO and a pending free trade agreement challenge of the U.S. relating to softwood lumber should also be in the works.
The meetings and discussions with U.S. officials to try to find a long term solution to the situation between our two countries can only help, not hurt, our industry. The series of ongoing discussions is part of the two track approach to this problem that the government has been engaged in for some time now: litigate if necessary and start the procedure necessary to do that, but also discuss at the highest level, from the Prime Minister, to the minister, to officials both American and Canadian, involve the industry widely in consultation, which the minister has done, and involve the provinces widely as part of these discussions to see if we can find the root causes once and for all of what is it the Americans do not accept. They have been repeatedly proven to be incorrect when they challenge that we subsidize.
Once and for all, let us get to the root problem. Let us come up with a solution that will be long term, that will give us free trade in softwood lumber and that will not find us back in these positions every few years fighting and winning this old battle once again, which is what we have had to do.
We understand why the United States industry continues to make false claims about our industry. We know that its concerns are based on protectionism and fear of losing market share. This is all about market share. Our producers have an excellent product at a good price. They have managed to capture 34% of the U.S. market and the American producers do not like it. It is not the fault of our producers that they do such a great job. They want free trade, they deserve free trade and the government will continue to fight for free trade for all Canadians.
While our exports have remained steady at about one-third of the U.S. market, this being the fourth attempt to erode our industry we know what the game is all about. We will not stand by while misinformation about our industry attempts to rule the day. Our government and indeed all MPs have a duty to set the record straight and defend the best interests of our industry. Our communities, the jobs that build them and the families that depend on a strong lumber industry deserve no less.