Mr. Speaker, it is a pleasure to rise in the House today to talk about the softwood lumber agreement and add my support to Bill C-24, which will bring it to life. I ask all members of the House to join me in supporting it.
As the Minister of International Trade indicated in his speech yesterday, the softwood agreement is good for industry, good for lumber communities and good for Canada. This is particularly true in my riding of Kamloops—Thompson—Cariboo, which relies heavily on the softwood lumber industry.
This agreement eliminates U.S. duties, ends costly litigation, takes our lumber producers out of the courts, provides stability for industry and returns more than $5 billion. It is a practical and flexible agreement that ends the dispute on terms that are highly favourable to Canada and will put Canada and the U.S. back on track for making North America more competitive for the future.
I am pleased to note that the agreement has won a wide base of support from both industry and the provinces. There are a number of good reasons for this support, but perhaps one of the more significant reasons is that this agreement respects the diversity of Canada's lumber industry.
As the House knows, the lumber industry across the country is varied and different regions have unique challenges and opportunities. Today I would like to highlight some of the regional benefits of the agreement and explain how it responds to a wide variety of needs across the country.
First, the agreement gives provinces flexibility in choosing the border measure that best suits their particular economic needs. Exporters will pay an import charge when lumber prices are at or below U.S. $355 per thousand board feet. When prices reach this threshold, Canadian regions, as defined in the agreement, the B.C. coast, the B.C. interior, Alberta, Saskatchewan, Manitoba, Ontario and Quebec, can select one of the following two export charge regimes: option A, an export charge with the charge varying with price; or option B, an export charge plus volume restraint, where both the rate and volume restraint vary with the price.
This innovative mechanism will allow provinces to choose the export charge that is right for their individual economic and commercial situation. I should point out that funds collected under either option will stay in Canada.
Provinces and industry also asked for flexibility in export quota rules to be able to meet their U.S. customers' requirements. In response, the government negotiated provisions allowing companies to carry forward or carry back up to 12% of their monthly export quota volume from the previous or next month. This is a significant improvement over the current environment.
Under the current system, the duties imposed by the U.S. are reassessed annually. The industry never knows from year to year what duty rate will apply. Under the agreement, they will know and can take full advantage of a stable, predictable business environment.
The agreement also contains a provision allowing provinces to seek an exit from the border measures based on a process to be developed by Canada and the U.S. in full consultation with provinces within 18 months of the agreement entering into force.
It provides for reduced export charges when other lumber producing countries significantly increase their exports to the U.S. at Canada's expense.
It protects provincial jurisdiction in undertaking forest management policy reforms, including updates and modifications to their systems, actions or programs for environmental protection, and providing compensation to first nations to address claims.
It includes an innovative mechanism to ensure that the $4.4 billion U.S. in returned duties will be back in the hands of our exporters within weeks of the agreement's entry into force. It also ensures that independent lumber remanufacturers, which do not hold tenure and are independent from tenure holders, do not have to pay an export charge on the value-added component of their products. This represents a significant improvement in treatment compared to previous agreements.
In addition to these benefits and the flexibility built in for provinces, the agreement also addresses region specific concerns that were raised by different provinces and stakeholders throughout the negotiation process.
For example, the agreement provides a limit on the export charge imposed on high value lumber products such as western red cedar lumber, which is primarily produced on the B.C. coast.
Through the agreement's anti-circumvention provisions, it also recognizes the importance of B.C.'s forest policy. B.C.'s market pricing system and any updates or modifications to the system have been given a full exemption under this agreement.
In response to Canadian industry concerns regarding the exemption of coastal logs and lumber and running rules that govern the administration of export measures, the U.S. has also confirmed that it is prepared to engage in early discussions to ensure the agreement operates in a commercially viable manner.
The agreement also directly responds to concerns expressed by Quebec, Atlantic Canada and the territories.
For instance, the border measures will not apply to the export of lumber products manufactured at Quebec border mills, a key position supported by the government of Quebec and its industry. In fact, the government achieved exclusions from border measures for a total of 32 companies in Quebec and Ontario, including the Quebec border mills.
The agreement ensures that lumber produced from logs harvested in the Atlantic provinces which are certified by the Maritime Lumber Bureau will not be subject to border measures. It ensures that lumber produced in the Atlantic provinces from logs harvested in the state of Maine is exempt from the border measures, a key component of bilateral trade in that region.
Also, it exempts from border measures lumber produced in the territories.
These elements of the agreement respond directly to the concerns raised by the provinces and industry throughout the negotiation period. They have helped garner a broad, substantial base of approval for this agreement in regions across Canada.
I am proud to lend my support to this hard-won agreement and to Bill C-24, which will bring it into force. Today I ask my fellow parliamentarians to do the same.
In conclusion, let me echo the words of Premier Gordon Campbell from my home province of British Columbia:
It's time for the costly litigation and instability experienced over the last decade to end and for a new chapter in British Columbia's ongoing forestry revitalization to begin.
I could not agree more.