Canada has proposed a temporary export tax on timber shipments to the US in a bid to resolve the long-running softwood lumber dispute.
The Canadian government’s proposal, which is said to be backed by the four main lumber producing provinces, is designed to bring the country’s timber prices in line with the US.
The export tax is planned to replace the US commerce department’s 21% duty on Canadian lumber imports and would remain in place until the provinces finish changing their timber management practices into a more market-based system.
Canada’s offer also requires an end to the ongoing complaints to North American Free Trade Agreement panels and the World Trade Organisation.
The US is said to be reviewing the proposal, which Canada says it has made in good faith in order to kick-start negotiations.
Potential problems include what happens to the C$4bn in duties already collected, the level of different North American lumber price thresholds and who decides whether the provinces have properly changed their timber management practices.
