Sunday, September 9, 2001

For more information, contact: Jen Waller, Communications Assistant 859-288-6154 or http://gov.state.ky.us/sga/index.htm

SOUTHERN GOVERNORS PRAISE ADMINISTRATION FOR TARIFF ON ILLEGALLY SUBSIDIZED CANADIAN LUMBER

LEXINGTON, Ky. - The southern governors commended the Administration today for placing a tariff on illegally subsidized Canadian softwood lumber and urged them to continue enforcing American trade laws. Passage of this resolution extends the involvement on this issue of the Southern Governors' Association (SGA).

In late August, the U.S. Department of Commerce invoked a 19.3 percent import duty on Canadian softwood lumber due to violations of U.S. trade law - thanks in part to strong backing by southern governors. This duty will be essential for the southern domestic lumber industry, workers and landowners to compete with the heavily subsidized Canadian industry.

With the pending expiration of the 1996 United States-Canada Softwood Lumber Agreement this Spring, the governors passed a policy resolution in September 2000 offered by Governor Roy E. Barnes of Georgia. It called on the Administration and Congress to fully enforce the agreement and encourage open and competitive sales of timber.

"This ruling by the Commerce Department will help our domestic producers compete on a level playing field," said Governor Barnes.

In addition to the resolution, originally passed last September, SGA urged the U.S. Trade Representative (USTR) to weigh in on the dispute. This Spring, in a response to a letter sent by Governor Barnes and Governor M.J. "Mike" Foster, Jr. of Louisiana, Robert Zoellick, the USTR emphasized that the softwood lumber situation is the Administration's "number one bilateral trade issue."

From 1991 to 1996, subsidized Canadian lumber went from 27% of the U.S. market to over 37%. Faced with additional duty cases from the United States, Canada proposed moderate export restraints in the 1996 United States-Canada Softwood Lumber Agreement, (holding Canada to exporting 14.7 billion board feet per year), which offset part of the injury from Canadian subsidies.

Founded in 1934, the Southern Governors' Association is the oldest and historically largest of the regional governors' associations. The mission of SGA is to support the work of the governors by providing a bipartisan, regional forum to help shape and implement national policy and to solve state and regional problems. The association's membership is composed of the governors of Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, Missouri, North Carolina, Oklahoma, Puerto Rico, South Carolina, Tennessee, Texas, the U.S. Virgin Islands, Virginia and West Virginia.