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Mexico, Canada Blame US for Unfairness in Trade

Mexican President Vicente Fox has finished a two-day visit to Canada. While the main purpose of the visit was to increase trade between their countries, the Mexican leader and Canadian Prime Minister Paul Martin also discussed a trade dispute that has arisen between Canada and the United States.

Boosting Mexican-Canadian trade and strong support for the North America Free Trade Agreement (NAFTA) were the main points in a speech President Fox gave on Friday to the Vancouver Board of Trade. But Mr. Fox also made reference to a recent decision by the Bush Administration to ignore a NAFTA tribunal ruling on softwood lumber imports from Canada.

The NAFTA tribunal ruled that a tariff the U.S. government tariff had imposed on imported softwood lumber from Canada was illegal and said that the $5 billion collected in duties should be returned to Canadian lumber companies.

The Bush Administration maintains that Canadian softwood lumber is subsidized by different provincial governments and that the tariff is needed so that U.S. lumber can compete fairly.

While not referring to the incident directly, the Mexican president made it clear that he sided with Canada in the dispute. He said abiding by NAFTA rulings created a better business environment.

"Mexico regrets any unilateral decisions that fail to abide by the decision of the arbitration panels where trade differences are discussed and aired," said Vicente Fox. " Mexico believes, that through the correct implementation of the agreement, our countries will create better trade opportunities for out businessmen."

The issue dominated a joint news conference that Prime Minister Martin held with Mr. Fox following a meeting of Canadian and Mexican cabinet ministers and business leaders.

In his comments, the Canadian prime minister was more blunt than Mr. Fox. Mr. Martin said what the Bush Administration is doing is wrong and promised that Canada would continue its efforts to get the United States to return the money it has collected.

"Now, that should have ended and the $5 billion that is being held, that belongs to Canadian companies, should have been returned to those Canadian companies," said Paul Martin. "That's the way the agreement should work. That's the way it was meant to work both in spirit and in the letter of the law. And it has been ignored by the Americans, and that is wrong. And we will take whatever actions are necessary in order to essentially make the letter and spirit of this agreement work."

In a written joint statement, Prime Minister Martin and President Fox discussed other issues, such as the importance of an elected UN Security Council, a western hemispheric free trade agreement, in addition to an upcoming climate change conference in Montreal.

The two leaders also received a report on the Canada-Mexico Partnership, an arrangement between the two countries to strengthen ties between governmental agencies and private industry.

President Fox started his visit in Calgary, which is often referred to as Canada's energy capital. While there, he talked about energy and natural resources with business executives and academics.