Seeking Common Ground: Canada-U.S. Trade Dispute Settlement Policies in the Nineties

By Andrew D. M. Anderson | Go to book overview
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Conclusions

This book has demonstrated that a positive step has been taken toward the continued liberalization of world trade with the implementation of the DSMs contained in the Canada-U.S. FTA and subsequently NAFTA. However, the much tougher task of making NAFTA work in practice as well as on paper lies ahead over the rest of the 1990s. For Canada, clearer decision making is particularly necessary on the rules governing the use of precedents for dispute settlement and also concerning the Working Group on Subsidies as required under NAFTA. In order to sustain the momentum of the Canada-U.S. FTA in NAFTA, the Government of Canada has to do its homework on the nature and impact of U.S. subsidies, compared to Canadian ones, and on the need to keep U.S. attention focused on the innovative aspects of the new DSM systems. If it succeeds in these endeavors, it will go a long way in reducing any protectionist use of the GATT-based AD and CVD laws by the United States against Canada that Chapters 2 and 3 of this book argued occur.

The Government of Canada will, however, face greater difficulty in the future in achieving the same heightened awareness of Canadian issues in the United States by the politicians there than it had over the period of the Canada- U.S. free trade negotiations. This was demonstrated by the U.S. negotiations with Mexico in the NAFTA talks where Canada's inclusion appeared to be largely an afterthought. For many U.S. politicians, their interests have turned to new areas of trade policy of particular concern for the United States. New areas include China trade, trade in services and intellectual property rights, a U.S. hegemonized hemispheric free trade area to rival the European one; while older concerns are the U.S. budget and trade and current account deficits. This means that it is critical for the Canadian government that the new gains made in dispute settlement must not be permitted to lapse to the detriment of Canadian exporters to the United States. The Government of Canada cannot afford to let the trade DSMs settle back to what was essentially the status quo prior to the signing of the FTA and eventually NAFTA. In order to maintain some awareness on the issues that still require settling under NAFTA, the Government of Canada can do a number of things.

To continue the successful implementation of the DSMs systems, and in order to iron out as many of the unanswered questions of their legal status as possible, there have to be regular consultations between the administrative agencies in Mexico, the United States, and Canada. This has to be both at the working level, i.e., between the trade economists and business specialists, and at the legal level between the Commissioners at the ITC, the Members of the CITT, officials at Revenue Canada and the U.S. International Trade Administration, and the members of the Mexican administrative agency, Secretaria de Comercio y Fomento Industrial (SECOFI -- Ministry of Commerce and Industrial Development), and Members of the Chapter Nineteen panels. The

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