Workers sort lumber at the Partap Forest Products mill in Maple Ridge, B.C., on Tuesday April 25, 2017. (DARRYL DYCK/THE CANADIAN PRESS)
British Columbia’s special envoy on the Canada-U.S. softwood lumber dispute is distancing himself from Premier Christy Clark’s threats of trade retaliation.
Former international trade minister David Emerson, who was appointed in February to represent the province in Washington, said in an interview he was not consulted on Ms. Clark’s bid to block shipments of thermal coal in a tit-for-tat measure in response to the new punitive softwood lumber tariffs imposed on Canada’s softwood exports to the United States.
“I have not participated in searching for retaliation measures,” he said Friday. “I’ve been aware of the thinking going on, but candidly I got a call this week that indicated it was a go.”
On Wednesday, Ms. Clark asked Ottawa to impose a ban on U.S. thermal coal shipped through British Columbia’s ports. The federal government has indicated it is supportive of B.C.’s request and is looking into it, a B.C. official said Friday.
Ms. Clark has vowed she is prepared to act unilaterally if Ottawa doesn’t. She said the province could use its Emergency Program Act to levy an “onerous fee that would be so high on the shipment of American coal, that it would no longer make any sense.” However, because Ms. Clark is in the middle of an election campaign and the legislature is not sitting, any such action would have to wait until after B.C. voters go to the polls on May 9.
Mr. Emerson said both sides in this dispute will need to be cautious about inflaming public opinion on either side of the border.
However, he noted that a certain amount of posturing is expected, recounting his time in the cabinet of Liberal prime minister Paul Martin during a previous round of the long-running softwood battle: “Some of the political rhetoric of the day was egregious, it was so stridently anti-American. It didn’t really stop the negotiations. The bedrock of Canada-U.S. relations tends to operate under the radar,” he said.
“It’s my view this will be largely under the radar, but to the degree that Canada and the U.S. are concerned about a political backlash on both sides of the border that could undermine the tone of the relationship, then things like this can have an impact.”
Mr. Emerson is a veteran of the Canada-U.S. trade wars over softwood lumber. He is a former chief executive officer of Canfor – one of the province’s largest lumber exporters – and held the federal international trade portfolio when he signed the deal that brought the last Canada-U.S. softwood-lumber dispute to an end in 2006.
Ms. Clark was in full rhetorical swing on Thursday when she told reporters: “I am not going to be a sucker for Donald Trump and accept the bad deals the Americans have offered so far.”
The “bad deal” she referred to was proposed by the Americans last fall, in the final days of the Obama administration. The United States floated a plan for a new softwood agreement that would cap Canada’s share of the American softwood lumber market at 22 per cent – a significant drop from the 34-per-cent share that was contained in the last agreement, which expired two years ago.
Mr. Emerson said the figures emerged from talks between Prime Minister Justin Trudeau and then-president Barack Obama in 2016, before the U.S. election.
“In the course of those discussions there were some – I won’t even dignify them as term sheets, but very rough term sheets exchanged around a market-share-based framework for a solution,” he said. “There was some recognition that 34 per cent was not sustainable, so there were some exchanges of market-share anchor points in an possible agreement, and the gap was wide.”
He would not divulge Canada’s proposal, but said there was little willingness in the Obama administration to invest any political capital in a deal.
This week, B.C. NDP leader John Horgan blasted Ms. Clark for giving up on a deal with the Obama administration: “Christy Clark’s failure to get a deal is putting thousands of jobs at risk,” he said.
A spokesperson for Foreign Affairs Minister Chrystia Freeland said any notion of there being a deal on the table is “completely false.”
“The proposals were never anything that would be acceptable to Canada.”
Susan Yurkovich, president of the BC Lumber Trade Council, said the U.S. proposal was roundly dismissed by federal and provincial governments, as well as by industry.
Canada exported close to 15 billion board feet of lumber to the United States in 2016 and a one-third drop in market share would cost thousands of Canadians their jobs, she said. “It would be devastating. It would have a very significant impact on the Canadian industry, including British Columbia.”
The impact of such a deal would be felt most harshly in B.C., which makes up 60 per cent of all of Canada’s softwood exports to the United States. Last year, B.C. sold $4.6-billion worth of softwood to the United States.
Ms. Yurkovich said the industry has no regrets that Canada didn’t take what it could get from the Obama administration, even as it now faces down a highly protectionist government under President Donald Trump. “It was not a serious offer and it was rightly turned down,” she said.