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Simeon Mitropolitski is a Canadian analyst, of Bulgarian origin, and a former syndicated columnist with the Bulgarian News Agency (BTA). He is the author of several hundred articles dealing with hot political and economic topics, both national and international.

He was part of the first group of Bulgarian intellectuals and students that began the opposition movement that finally put an end to the communist regime in this country in 1989, and in 1996-1997 participated in international observation teams during the elections in several Balkan countries - Romania, Albania and Bulgaria.

In 2002 Simeon and his family moved from Bulgaria to Canada where they live now in Montreal, province of Quebec. Simeon is a Master of Political Science from McGill University and a B.A. of Political Science and History.

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It was at the end of the war in Iraq. A prominent Canadian TV anchor said that: "The Americans know well how to deal with the enemies but still find difficulties talking to their friends and allies". These days I remembered this phrase, learning that there wasn't progress between the United States and Canada over the softwood lumber dispute. More than that, the two sides seem ready to go to court to defend their respective positions. They forget that the present situation of trade war isn't beneficial for either side of the border. In this respect every compromise will have positive far-reaching effects.

The first cannons of this trade war were fired in 2001 when the US softwood producers claimed Canadian material were subsidized by low timber-cutting fees and were imported at below their real cost. The Canadian government always denied these accusations. After reaching no compromise, in 2002 Washington imposed high anti-dumping duties on the Canadian softwood imports, totaling $6 billion per year.

The latest developments included a draft proposal for compromise, prepared by both governments, which was rejected by the Coalition for Fair Lumber Imports, representing the American producers. The proposed compromise could establish new five-year quota arrangement similar to the one that expired in 2001 and the Canadian producers could export lumber equal to 30 per cent of the American consumption duty free. The American producers don't accept the compromise and want this ceiling lowered by further 2%. Right now Canada contributes to roughly 33% of the whole American market, so any such lowering as suggested by the American producers will mean consensual market share reduction of some $300 million.

The lack of progress coincides with difficult economic and political times on both sides of the border. The both economies are struggling to avoid deep recession. In the United States the new presidential campaign is about to begin soon and the economy will again be the major topic as was in 1992. In Canada the current prime minister is counting the days before leaving the office and his room for maneuvering has been shrinking. The chances of reaching compromise in the months ahead still exist but they are getting smaller.

These sensitive from political point of view periods are perhaps one of the reasons why the U.S. trade negotiations aren't going well, not only with the Canadians but also with so many countries. Given the complex of issues to be settled down, every trade agreement requires years of constant work and dedication by any government. In Europe there is a beneficial division of tasks between the elected governments and the appointed Commission. So the national election campaigns don't interfere too much with the trade negotiations led by the Commission. The fact is that 15-member EU is about to include 10 new countries by 2004. In the United States the administration is part of the political game. With presidential election approaching, it tries to attract as many as possible special economic interests. In this case a lumber dispute with Canada is an ideal way to show that Washington thinks about the national producers.

The trade is made between friends, not enemies, so inevitably the first casualties in any trade war are counted among the best friends. The US presidential campaign becoming longer and longer, the time for settling these disputes becomes shorter and shorter. At the same time EU forges and builds upon new trade relations with new markets, some of them geographically close enough to the United States.

Canada now makes more than 80% of its international trade with its southern neighbor. I won't be happy if this percentage goes down influenced by purely political reasons.

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See Also:
US-Canada: A timber war on the horizon
US-Canada lumber dispute: Episode 2

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