U.S. Trade Representative Robert Lighthizer criticized Canada at the end of the latest round of talks to renegotiate the North American Free Trade Agreement, saying that a recent trade action brought by it against the U.S. was an "unprecedented" and dangerous move.
"It constitutes a massive attack on all of our trade laws. If it were successful, it would lead to more Chinese imports into the United States and likely fewer Canadian goods being sold in our market," Lighthizer said in Montreal on Monday at the conclusion of the sixth round of talks to renegotiate the 1993 trade deal among the U.S., Canada and Mexico. Further talks are expected through the summer.
Lighthizer was referring to a complaint filed with the World Trade Organization last year challenging the United States' anti-dumping and anti-subsidy duties. The penalties are frequently used by the U.S. to restrict imports that it says are unfairly subsidized or otherwise boosted by their home country. Canada's complaint says the duties violate the WTO’s rules for dumping and settling disputes, among other charges.
"Of course, we view this case as frivolous, but it does make one wonder if all parties are truly committed to mutually beneficial trade. It also underscores why so many of us are concerned about binding dispute arbitration. What sovereign nation would trust to arbitrators or the flip of a coin their entire defense against unfair trade?" Lighthizer said Monday.
He also slammed two proposals put forward by Canada during the NAFTA talks regarding the rules of origin for determining which country a product can officially be labeled as coming from the USA, and what he termed as a proposal by Canada to allow it to enter into trade deals with non-NAFTA countries on more advantageous terms than with NAFTA ones.
Lighthizer nevertheless said some progress had been made in the latest round and that the respective countries had finally begun to discuss the "core issues," indicating he expected at least a few more rounds of talks before they are concluded.
The renegotiations have been strained. Canadian and Mexican officials have rejected the administration's demands to change the rules the origin and a proposal to add an end clause to NAFTA as well as to allow countries to opt out of its investment dispute settlement system, among other changes.