Japan, Mexico Prepare to Follow EU, Canada Sanctions on U.S.

[Robbien]

April 1 (Bloomberg) -- Japan and Mexico are preparing to follow the European Union and Canada in imposing extra import duties on U.S. goods after Congress failed to repeal a law that has handed companies such as Timken Co. more than $1 billion in tariffs paid by their competitors.

. . .

Unless Congress repeals the law, the case may become the most damaging ever at the WTO when the U.S. begins distributing tariffs collected on Canadian lumber, worth $4 billion a year. Japan, the economy most affected by the Byrd Amendment, has the right to impose customs duties worth 125 billion yen ($116 million), the biggest sanctions awarded to Japan in a dispute. ``We have not yet decided when our retaliation measures will be invoked,'' said Kunihiko Kawazu, first counselor at Japan's mission to the WTO in Geneva. ``We have already been authorized to do so at any time, but we will make a judgment taking into account how the discussion in Congress goes on repealing the Byrd Amendment.''

. . .

Mexico is deciding which U.S. products will be targeted, said Fernando de Mateo, the country's ambassador to the WTO. ``We're analyzing with what we're going to retaliate,'' he said. ``The problem is not revenge; the problem is you cannot have your cake and eat it. This amendment provides an incentive for producers to say `my neighbor is hurting me.'''


``Japan will move slowly, but ultimately it will move,'' said Lewis Leibowitz, a trade attorney with Hogan & Hartson LLP in Washington and legal counsel to Consuming Industries Trade Action Coalition, an organization lobbying for the Byrd Amendment's repeal that counts Caterpillar Inc., Procter & Gamble Co., Emerson Electric Co. and Nissan North America Inc. among its members.

. . .

In their complaints, the governments said the law enables the U.S. to punish exporters twice -- first by imposing a duty and then by giving the money collected to the exporter's rivals. After the U.S. missed an end-2003 deadline for compliance, the WTO authorized governments to impose retaliatory duties on U.S. goods equal to 72 percent of the total paid by their companies.

http://www.bloomberg.com/apps/news?pid=10000082&sid=af9bicBXejsk&refer=canada

[achtung_circus]

1. Eventually, the worm turns.

IMO it's long past time. In some cases the worm may turn off the tap. The pure unadulterated greed and chauvinism of the Byrd amendment is symbolic of the "ugly American" glasses through which more of the world is viewing your country.

My problem is, I don't understand the short-sightedness of it. Do the powers that be really expect that the rest of us on this palnet will play along indefinitely?

[Robbien]

2. This is another area where everyone outside of the US knows

all about the Byrd Amendment and few people inside the US even know it exists.

[idlisambar]

16. Not right, on trade the U.S. is not "ugly" it's a laughing-stock.

If you would take a look at the trade figures you will find that the U.S. had a $667 billion current account deficit.

[mmonk]

3. And all "our" multi nationals

are filing suit with their labor constituency. In the meanwhile, the US serves the interests of these multi nationals.

[CHIMO]

4. This Is A Baby Step

Canada slaps rare sanctions on U.S.

Ottawa — Canada has turned up the pressure on its largest trading partner, slapping rarely used sanctions on the United States to force an end to an internationally condemned trade law.

But trade watchers applauded the move as sending a powerful signal, especially since Canada so seldom slaps sanctions on its largest trading partner.

"It's a rare thing and I think it will be seen as a significant event on the other side of the border," said Carl Grenier, president of the Quebec-based Free Trade Lumber Council, representing hard-hit softwood producers.

"I think this is a strong message that we're all sending to the United States that the international rules, those of the WTO (World Trade Organization), must be respected," Mr. Peterson told reporters in Toronto.

http://www.theglobeandmail.com/servlet/story/RTGAM.20050331.wtrade31/BNStory/National/

A break up in trade will affect US guaranteed supply of Canadian oil and natural gas. Nobody, but nobody in the US is paying attention,

[Robbien]

5. What surprised me is that Canada is the largest source of our oil

and Mexico is a close second.

This action by Canada is a big event but is getting very little attention, even here on DU.

[Horse with no Name]

6. It seems to me this is one of the most important stories

to come out today--even surpassing the Schiavo funeral/Pope death watches.
Very interesting.

[CHIMO]

7. And For Those

That are not aware, NAFTA requires Canada to share the oil with the US in the event of a disruption. This means that the split between Canadian consumption and US exports will be maintained. This loss of sovereignty was thought to bring about fair trade without political interference. It is not working. It has been festering for 4 years in softwood lumber and less in cattle.
What seems to be acquiescence by Canada in the US is becoming a reason to cancel NAFTA. Don't forget that the present Canadian government is in a minority position.

[Robbien]

10. Could you explain the sharing the oil deal

What is meant by 'event of disruption'?

[CHIMO]

11. Just Did A Google

And picked this up. I am sure a bit more time would turn up a more definitive work.

Here is what I picked up.

http://www.theglobeandmail.com/servlet/story/RTGAM.20050217.webcolaxer16/BNStory/National/

When President George W. Bush laid out his goals in his State of the Union address, one was "to promote energy independence for our country." Mexico, Canada's other NAFTA partner, also has a policy of oil energy independence and Mexican public ownership. Canadians seem blissfully unaware that, while our NAFTA partners are looking after their own energy security, Canada is the only NAFTA country prevented from doing so by the energy exporting provisions in NAFTA.

Canadians have not faced oil shortages since the 1970s, so managing without seems a remote possibility. But several recent changes should give us pause.

First, even greater instability in the Middle East, the illegal occupation of Iraq and insurgents' destruction of oil pipelines there, and recent strikes in Venezuela and Nigeria make supplies precarious. Add to instability a dwindling potential supply, because peak production was reached in most producing areas of the world some time ago. Demand, meanwhile, is rising quickly, especially in energy hungry China and India, but also in the gas-guzzling United States.

In 1993, oil and gas corporations based in Canada, many of them foreign-owned, lobbied for a proportionality clause to be included in NAFTA, which was then being negotiated. Under proportionality, Canada can cut exports to the U.S. to deal with shortages, only if we cut the same proportion of supplies to Canadians. This would not help at all.

--------------------------
I should point out that the author of this piece is a strong proponent for Canada first. Corporations don't have the same thoughts. The article gives a bit more info. If you still would like more I can search further.

[Robbien]

12. Thanks

I thought you knew what it meant. Didn't mean for you to do any research just to satisfy my curiosity.

Thanks.

It makes one wonder why Canada signed the NAFTA agreement in the first place and also what Canada was doing talking to China if the NAFTA agreement makes it difficult for Canada to do oil business with anyone other than the US.


Hmmmm.

[CHIMO]

14. Believe That The

Split is the ratio of Canadian consumption to US exports. I would have to search further to get the actual definition.
The movement to China is to decrease the dependency on exports to the US.

NAFTA was signed as the next generation to a previous agreement that was negotiated between Regan and Mulroney, who happened to have destroyed one of the founding political parties of Canada. The rest is a long story which has yet to be fully told nor explained.

[Ian David]

13. This is too small. They should have a global embargo against America

They should do to us what we've done to Cuba.

Or, they can do to us what we did to Iran-- make it illegal for anyone except Halliburton to do business with us.

[frictionlessO]

8. The lack of attention this is getting is disturbing on many levels.

Biggest news today in my book.

[Robbien]

17. I am starting to believe the news blackout on this is deliberate

Similar to the news blackout on the soft timber dispute.

Jane and John Doe believe Canada likes us and the rabid right believes it can continue to critize Canada with impunity.

If there is no fuss here, then there is no problem and the WH will just use under the table political force to make this go away.

[Igel]

9. Bad for dems.

There was a repub anti-dumping bill that was either defeated or wasn't going to pass, S. 61. Byrd (D-WV) took the language and put it in an agriculture appropriations bill that nobody was going to vote against: who's going to vote against agriculture and rural development. They didn't have the votes for removing the language. It passed as part of the much larger appropriations bill. This is back in 1999/2000. Hence "Byrd Amendment". Pre-dates *.

I'm not sure how to score political points off this. Essentially the repubs are bad for not having repealed the law. But it would have to be spun as "the repubs passed it ... please ignore why they couldn't not pass it and focus on why they haven't repealed it."

[Theres-a]

15. Uh-oh.

[Horse with no Name]

18. kick and nominated. eom