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PM forced to defend lumber deal

[PoliticsWatch updated 5:15 p.m. June 18, 2007]

OTTAWA  —Almost a year after it was signed, Prime Minister Stephen Harper rose in the House of Commons Monday to defend the softwood lumber agreement with the U.S. after reports on the weekend that Canada may consider making concessions to the U.S. 
  

The concessions could come because of formal U.S. complaints about provincial lumber policies. 

"Any disputes now that are occurring between Canada and the United States are occurring within the framework of an agreement that gives Canada ongoing and secure access to the U.S. market," Harper told the House of Commons. 

On Saturday, the Globe and Mail reported Trade Minister David Emerson said opinion in government is divided over whether Ottawa should fight in court a U.S. complaint that some provincial aid programs to the lumber industry are subsidies and the Canadian companies are not paying enough export taxes under the 2006 deal.

Emerson said he would rather work constructively with the U.S. on these issues than face another lengthy bout of litigation.

This position is not supported by industry, especially in British Columbia, which wants the government to proceed through formal arbitration. 

The Canadian industry is bracing for another round of possible complaints by the U.S. on other issues, including certification for independent remanufacturers. 

The last softwood lumber dispute with the U.S. lasted over four years, cost the government millions in legal fees to Canadian and American law firms and was handled by three different trade ministers in three different governments. 

The Conservative government's ability to reach an agreement after just three months in power was seen as a major victory at the time for both Harper and Emerson. 

Emerson's comments to the Globe outraged NDP leader Jack Layton who asked in question period, "Why do governments continue to make concessions when negotiations are over?"

"We're seeing the United States attacking our provinces for simply trying to manage their natural resources and what does the government do? They start looking at the idea of adding export taxes to this sector and that will cost us more than the tens of thousands of jobs that we've already lost."

The prime minister responded to Layton by noting that the Canadian industry "wants the agreement to remain in effect" and do not want the Liberals and NDP who voted against the deal to tear it up and return the country to litigation. 

Emerson was not in the Commons on Monday, but his parliamentary secretary, Ted Menzies, rejected allegations by Liberal MP Navdeep Bains that the government was caving to the U.S. softwood lobby and "selling out the Canadian industry." 

Menzies said having the 2006 agreement was good because "we are dealing with the Americans in a face-to-face discussion." 

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