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Mexico, Canada Urge Strengthening of Trade Pact
Date: Monday, October 03 2005
Topic:


Mexico, Canada Urge Strengthening of Trade Pact (Update1)
Sept. 30 (Bloomberg) -- Mexican President Vicente Fox and Canadian Prime Minister Paul Martin jointly urged a strengthening of rules governing trade disputes under the North American Free Trade Agreement.

Fox signaled Mexican support for Canada in its drive to convince the U.S. to abide by a Nafta panel ruling to return more than C$5 billion ($4.3 billion) in punitive tariffs levied on Canadian exports of lumber to the U.S.

``We, both Canada and Mexico, are wanting the enhancement of the disputes mechanism so that we can make sure that we can move aside all kinds of obstacles,'' Fox, 63, said today in Vancouver before meeting with Martin, 67.


The dispute over softwood lumber has become an irritant in trade and political relations between Canada and the U.S. The Canadian government canceled talks with the U.S. in August aimed at resolving the spat after the U.S. said it wouldn't honor the Nafta panel's findings.

``We want Nafta to work,'' Martin said at a joint news conference. ``To work, we must be faithful to the letter and the spirit of the agreement.''

The U.S. began imposing tariffs in 2002 in retaliation for the pricing of Canadian timber, a practice the U.S. government contends subsidizes Canadian lumber exports and harms U.S. producers of forest products.

Canada has tried to pursue resolution of the dispute through the rules of Nafta. The U.S., while defending itself under the trade agreement, has emphasized the need for a negotiated settlement.

``Mexico regrets any unilateral decision that fails to abide by the decisions of the arbitration panels where trade differences are discussed and aired,'' Fox said in a speech today to the Vancouver Board of Trade, the city's chamber of commerce.



To contact the reporter on this story:
Christopher Donville in Vancouver cjdonville@bloomberg.net.

Last Updated: September 30, 2005 20:16 EDT

http://www.bloomberg.com/apps/news?pid=10000082&sid=auCsNNhanw2k&refer=canada#

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