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<title>PETTIGREW EXPRESSES CONCERN OVER U.S. STEEL DECISION</title>
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<p><font size="+1"></font><font size="+1"><strong>August 27, 2001 <em>(12:45 p.m. EDT)</em> No. 125</strong></font><font size="+1"></font></p>
<p align="CENTER"><font size="+1"><strong>PETTIGREW EXPRESSES CONCERN OVER U.S. STEEL DECISION</strong></font></p>
<p>International Trade Minister Pierre Pettigrew today expressed disappointment and concern over
an August 22 decision by the U.S. International Trade Commission (ITC) that imports of steel
wire rod from Canada are undermining the effectiveness of the import relief provided by the U.S.
President in February 2000. The Commission will be forwarding its findings to the President,
who will decide whether to extend import relief to imports from Canada and Mexico. </p>
<p>"We will not stand by and let the Canadian industry face unwarranted U.S. import restrictions.
While the NAFTA [North American Free Trade Agreement] does allow previously excluded
imports from another NAFTA party to be included in an import relief action, we do not believe
that the conditions under which such action can be taken have been satisfied," said Minister
Pettigrew. "We will be making that view known to the U.S. Administration." </p>
<p>In Canada's view, imports from Canada have not undermined the effectiveness of the import
relief action, which took the form of a tariff rate quota on wire rod imports from which Canadian
and Mexican products were originally excluded. U.S. imports of wire rod from Canada have
shown stable growth since the action went into effect on March 1, 2000. Further, the prices of
Canadian imports remain higher than the prices of imports from other sources, an important
factor in the original finding that imports from Canada were not contributing to the serious injury
of the U.S. industry. </p>
<p>Under the NAFTA, if action is taken to extend the relief to imports from Canada, the United
States cannot reduce the level of imports from Canada below historical levels and must provide
for growth. In addition, the United States must provide for compensation for any trade
impairment. If agreement on compensation is not reached, Canada has the right, under the
NAFTA, to retaliate by imposing restrictions on U.S. imports that have an equivalent effect. </p>
<p>The ITC finding is not connected to the more general safeguard investigation initiated by the ITC
on all steel products in June. </p>
<p align="CENTER">- 30 -</p>
<p>For further information, media representatives may contact:</p>
<p>Sébastien Théberge</p>
<p>Office of the Minister for International Trade</p>
<p>(613) 992-7332</p>
<p>Media Relations Office</p>
<p>Department of Foreign Affairs and International Trade</p>
<p>(613) 995-1874</p>
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