Canadian Ambassador to the United States Frank McKenna underscored the importance of Georgia's massive trade with his country during a speech at the Federal Reserve Bank of Atlanta last week but warned that the controversial Byrd Amendment is a deterrent to U.S.-Canada trade.
Mr. McKenna spoke to a group of consular corps members and businesspersons during his first trip to Georgia after assuming the ambassadorship in March.
“Georgia is a powerful partner with Canada in international trade. Canada is by a long-shot your most important trading partner,” he said, noting that Georgia's $9 billion per year two-way trade with Canada is greater than with its next three top trading partners – Mexico, Japan and the United Kingdom – combined.
One of every five Georgia exports, or roughly 22 percent of the state's exports, is purchased by Canadians, Mr. McKenna said, adding that 150,000 jobs in Georgia are supported by this state's trade with Canada. More than 100 Canadian companies have located in Georgia, he noted, and said that Canada does more business with Atlanta-based Home Depot Inc. than with the country of France.
Mr. McKenna attributed this dynamic trade relationship to globalization and free trade agreements like Nafta, saying, “Protectionism is the wrong way to go.” He denounced the Byrd Amendment, a congressional provision meant to prevent other countries from “dumping,” or deliberately selling products below cost in U.S. markets to gain a competitive edge.
Formally known as the Continued Dumping and Subsidy Offset Act of 2000, the amendment authorizes U.S. attorneys to collect damages from the alleged “dumpers” to compensate the U.S. companies that complain. No specific use of the funds is required. The U.S. government collected $284 million last year to pay out to various companies.
The measure has drawn strong criticism from foreign governments since Sen. Robert Byrd (D-W.Va.) attached it to the Agriculture Appropriations Act of 2000 that was signed by President Clinton in October 2000.
Canada recently added a 15 percent tariff to several U.S. exports, including farm products and cigarettes, in retaliation against the Byrd Amendment, which, although deemed illegal by the World Trade Organization in January 2003 as an unfair subsidy to U.S. manufacturers, has still not been repealed.
The European Union has also applied additional tariffs to some U.S. paper products and machinery exports. Eleven countries in all, including Australia, Japan and South Korea, have filed complaints with the WTO in response to U.S. inaction.
Underscoring his opposition to the Byrd Amendment, Mr. McKenna touted the merits of free trade between his country and the U.S., asserting, “Globalization is the right thing for our economies.”
“Nowhere has [free trade] been more beneficial than between Canada and the U.S.,” he said of the largest binational commercial relationship in the world, equivalent to $2 billion per day or $1 million each minute in trade across the Canada-U.S. border.
One-quarter of U.S.-made products go to Canada, and trade between the countries supports five million jobs in the U.S. and two million in Canada, Mr. McKenna said. He added that 500,000 people cross the border each day.
Canada is also the U.S.' top single source of oil, natural gas, electricity and uranium, Mr. McKenna noted. “Our energy relationship is dramatic. Canada provides a reliable supply of energy larger than any supplier the U.S. is currently dealing with. Our capacity is greater than Saudi Arabia's,” he asserted.
Mr. McKenna heralded Canada as a “spectacular location for companies looking to expand their offerings” because of its low tax rates, widespread Internet usage and national budget surplus. He noted that Canada has had a surplus for the eight years and expects to run a surplus for the next five.
Gov. Sonny Perdue will affirm the important relationship Georgia has with Canada when he leads a business delegation to the country July 26-28 to explore new trade and investment opportunities, as well as provide Canadian participants with an update of Atlanta's candidacy for becoming the Free Trade Area of the Americas headquarters. Georgia Department of Economic Development Commissioner Craig Lesser, Hemisphere Inc. Executive Director Jose Ignacio Gonzalez and Canadian Consul General in Atlanta Malcolm McKechnie will accompany the governor.
Contact the Canadian Consulate General for more information at (404) 532-2030 or [email protected]