NEWS RELEASES

May 12, 2000 No. 103

CANADA WELCOMES BRAZIL'S OFFER TO NEGOTIATE

COMPLIANCE WITH WTO RULING ON PROEX

International Trade Minister Pierre Pettigrew welcomed Brazil's offer to negotiate implementation of the recent World Trade Organization (WTO) ruling on Brazil's Proex program. Discussions are expected to take place within the next 10 days.

"Canada has always been interested in negotiating a satisfactory agreement with Brazil, and we welcome the Brazilian initiative," said Mr. Pettigrew. "We are encouraged by Brazilian Foreign Minister Luiz Felipe Lampreia's recent statement that Brazil is prepared to implement the WTO ruling with respect to future contracts. We will want to review the details of implementation for future contracts, in addition to discussing the treatment of undelivered aircraft, and are hopeful that these discussions will set the basis for resolving this dispute."

Earlier this week, Canada acted to protect its WTO rights in its dispute with Brazil over the withdrawal of prohibited Proex export subsidies by seeking WTO authority to retaliate against Brazil.

On May 9, a WTO panel ruled that Brazil's Proex program continued to be an illegal export subsidy. This ruling followed an August 1999 WTO appellate body decision, which stated that Brazil must withdraw its Proex program.

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For further information, media representatives may contact:

Sylvie Bussières

Office of the Minister for International Trade

(613) 992-7332

Media Relations Office

Department of Foreign Affairs and International Trade

(613) 995-1874