In late summer, I posted a news item on how American paper companies had imposed a 20% duty on coated paper from the Port Hawkesbury Mill (NS), while Irving Paper (NB) and Catalyst Paper (BC) had an 18% tariff imposed. The U.S. has also demanded that NAFTA Chapter 19 Dispute Resolution Panels be scrapped. In the past, most of its decisions were won by Canada. Ottawa has promised to walk away from the current talks before it accepts a NAFTA without these panels. At press time, negotiators still had not drilled down to the more complicated issues.
When I delved further into NAFTA, I discovered trade and political relationships so complicated, they seemed to defy compromise. Here’s a one-off example of ‘complicated’. Those tariffs didn’t sit well with another unlikely group – lawmakers from Maine. Why? Because Irving and Catalyst employ about 1,000 people there! In fact, Maine Senators Angus King, Susan Collins and Governor Paul LePage wrote to the U.S. Commerce Department at the time requesting an objective review. If NAFTA is scrapped or altered drastically, most experts agree that the side effects could be devastating for Canada, the USA and Mexico.
President Donald Trump has said he’ll “probably” end NAFTA. But the bellicose bloviating billionaire has also tweeted grandiose statements before which he later walked back. For example, in 2015 he praised Canada’s healthcare system, saying that the U.S. could learn a lot from it. Then in 2016 while campaigning, he called it “a disaster.”
As negotiations continue, Canada does have a few cards to play – not the least of which is the fact that we supply the U.S. with just over 40% of its energy needs and export products to over 35 states, creating huge employment opportunities. But the U.S. also exports to Canada and creates thousands of jobs here as well. Hopefully the guiding principle will be “compromise” – but that seems to be missing from Trump’s vocabulary.
So what does all this mean to Canadian printers? Unfortunately, only the future will tell. In the meantime, I fully intend to follow-up with these paper mills and post updates and comments from them on our website. This could give us a unique inside glimpse of what we might expect, how they’re coping, and what strategies might prove best.
Until next time, always remember that we’re here to help.
The NAFTA conundrum
