Trade tensions may appear to be escalating between Canada and the White House, but U.S. Secretary of Commerce Wilbur Ross denies that an all-out trade war is on the horizon.
In an exclusive one-on-one interview with CTV鈥檚 Richard Madan in Washington, D.C., the Trump administration鈥檚 commerce chief touched on recent flare-ups over Canada鈥檚 dairy and softwood lumber industries, and discussed other sectors that may be reconsidered under NAFTA.
On Monday, the U.S. imposed significant new duties of up to 24 per cent on lumber imports. The sudden tariff is expected to cost jobs in Canada鈥檚 softwood lumber industry, which relies heavily on sales to the U.S.
Speaking with CTV News, Ross stood behind the move.
鈥淣o, I don鈥檛 think it鈥檚 the start of a new trade war. The dispute over softwood lumber has been going on for as long as I can remember,鈥� Ross said.
鈥淚 think even friendly trading partners should live by the rules. And I feel based on the work that we鈥檝e done that Canada did not live by the rules in the case of the softwood lumber.鈥�
U.S President Donald Trump blasted Canada鈥檚 dairy industry last week, saying that the supply management system was unfair to Wisconsin farmers who want to sell milk north of the border. This week, Trump targeted softwood lumber, a longstanding trade rift between the two countries.
Ross suggested that other industries may soon be put under the Trump administration鈥檚 microscope as it moves closer to renegotiating the North American Free Trade Agreement.
鈥淲ell, part of the problem with NAFTA is that it doesn鈥檛 include everything that it should include. But there are also other issues. Canada has adapted what I would call and anti-patent position, particularly in pharmaceuticals,鈥� Ross said.
Asked about rules of origin for auto parts, an important piece of NAFTA that lays out rules for the auto industry, Ross called it an 鈥渋mportant issue鈥� that may be up for discussion.
鈥淚 think it should be on the table because if there is any merit at all to a free trade agreement, it鈥檚 to help the people inside versus the people outside,鈥� he said.
Ross later clarified that Asian auto part makers are a critical part of the equation, and that new limitations on those countries could protect North America鈥檚 auto industry as a whole.
Prime Minister Justin Trudeau met Trump just three months ago in Washington in a meeting that focused on the country鈥檚 shared values and longstanding trade relationship. At the time, Trump said his concerns with NAFTA had more to do with Mexico, and any changes to Canada would just be 鈥渢weaking.鈥�
Trudeau responded to the new softwood tariff Tuesday, saying that a 鈥渢hickening鈥� border would be detrimental to both the U.S. and Canada.
"We are tremendously interconnected in our economy with that of the United States, but it's not just a one-way relationship," Trudeau said during a visit to Kitchener, Ont.
"There are millions of good U.S. jobs that depend on smooth flow of goods, services and people back and forth across our border."
Trudeau spoke directly with Trump later Tuesday. According to a statement from the Prime Minister's Office, the prime minister "refuted baseless accusations" on the softwood lumber industry and said he would vigorously defend the sector.
The two leaders also "agreed on the importance of reaching a negotiated agreement," the statement read.
Sources say the White House plans to release new information on its plans for NAFTA very soon.
