NEWS RELEASES

July 19, 2001 (4:30 p.m. EDT) No. 109

GOVERNMENT OF CANADA SUPPORTS

PLAN TO ADDRESS STEEL TRADE PROBLEMS

The Government of Canada today released a report outlining potential actions Canada can take to oppose any restrictions on Canadian steel exports to the United States.

The report, which was prepared by a government-industry working group, has been endorsed by International Trade Minister Pierre Pettigrew, National Revenue Minister Martin Cauchon and Secretary of State (International Financial Institutions) James S. Peterson.

The report also addresses the possible diversion of offshore steel from the United States to Canada as a result of the U.S. safeguard investigation on global steel imports.

"The U.S. investigation responds to problems created by non-NAFTA [North American Free Trade Agreement] steel imports, but the investigation targets imports from all countries," said Minister Pettigrew. "The U.S. Administration has indicated that this investigation is not aimed at Canada, and we will work with the industry to obtain an exemption under the NAFTA."

"The Canada Customs and Revenue Agency has always supported the steel industry and will continue to do so where warranted," said Minister Cauchon.

To respond to possible trade diversion, the government and industry have agreed to meet regularly to review steel import statistics. If trade diversion is detected and creates critical circumstances for the domestic industry, the government could impose a provisional surtax while the Canadian International Trade Tribunal conducts a safeguard investigation.

"Canadian steel producers have made major investments to maintain competitiveness, and we will not allow the Canadian market to be side-swiped as a result of the U.S. action," said Mr. Peterson.

Other actions could include an anti-dumping investigation by the Canada Customs and Revenue Agency if there is evidence that steel being diverted from the United States is being dumped into Canada.

Canada's steel exports to the United States were $3.6 billion in 2000 and represent 30 percent of domestic steel production.

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A backgrounder and summary of the Steel Working Group report are available at the Department of Foreign Affairs and International Trade's Web site:

http://www.dfait-maeci.gc.ca/tna-nac/steelback-e.asp

http://www.dfait-maeci.gc.ca/tna-nac/steelrep-e.asp

For further information, media representatives may contact:

Mora Johnson

Office of the Minister for International Trade

(613) 992-8341

Media Relations Office

Department of Foreign Affairs and International Trade

(613) 995-1874

Suzanne Thébarge

Press Secretary

Office of the Minister

Canada Customs and Revenue Agency

(613) 995-2960

Jean-Michel Catta

Chief, Consultations & Media Relations

Department of Finance Canada

(613) 996-8080

This document is also available on the Department of Foreign Affairs and International Trade's Internet site:

http://www.dfait-maeci.gc.ca