PAKISTAN

Deus ex machina?

Ashraf Jehangir Qazi 

WHAT is happening to Pakistan? Anyone interested in the question knows the answer. Who is to blame? Opinions differ.

However, there is broad agreement on the cast of culprits: political leaders; political parties; political institutions; non-political institutions; the security and intelligence establishment and its institutions; the civil services; comprehensive corruption; the dysfunctional state of the economy caught in a permanent debt trap and outrageous inequality; complete external dependency and a consequent lack of policy independence; a general lack of education and a scientific outlook; the media contributing to an uninformed, partially informed and misinformed public opinion; the deliberate misuse of religious fervour to obscure the true teachings of our faith; an obsolete social structure preserved by a voracious and unaccountable power structure; a judiciary that demands but does not command universal respect; uncontrollable population growth; irreversible climate change; a forever threat of nuclear annihilation, a security environment that challenges rational resource allocations; palliatives presented as solutions, etc.

We are taught that one should neither hate nor act in anger. This is true as far as persons are concerned. But actions that deliberately undermine the welfare of a whole people can and must be hated. When they threaten the survival of a nation and render its dreams and aspirations impossible they must be confronted by the elemental force of rejection.

Read: Cohesion is needed to fight challenges

If, instead, political observers and commentators couch their opinions in euphemistic and safely coded language they become complicit in the perpetration of a national crime. They convey a pathetic message of resignation, surrender and betrayal. There comes a time when Faiz Ahmad Faiz has to give way to Habib Jalib. Either Quaid-i-Azam was much mistaken or we are all complicit in insulting his memory and murdering his legacy. We prefer, however, to slander the father of our country instead of becoming the citizens it required.

We are today, accordingly, reduced to being spectators of a daily goon or puppet show in the guise of a morality play — without any wit, humour or goodwill. There are no good guys in the unfolding drama of our national tragedy.

The Baloch are killed. Their killers are martyred. When one political character attributes unspeakable and unforgiveable crimes and misdemeanors to his rival we know he speaks the truth. When his rival returns the charges redoubled we know he too speaks the truth. They are of course transparent partners in a single, massive and lethal crime against the people and the country.

So what else is new? What should be new is the realisation that we who are aware and do nothing are just as guilty. If one can live with this realisation so be it. If not, we need to do what we can and without delay. The chances are we won’t. The chances are we have already lost our country. Unless…

Another wasted year of political posturing by rupee multibillionaires representing their victims beckons. While the US contemplates a climate emergency, Pakistan is beset by an existential emergency that commands no contemplation. All the challenges confronting Pakistan will be ignored. Technocratic servants of the elite will continue to spin fairy tales about stabilisation and progress invisible to the eye of the uninitiated. They will be well compensated for dressing their employers in the finery of their analyses and assessments. Other servants or experts will do much the same in their own spheres. The people must learn to eliminate the word ‘sarkar’ from their political dictionary if they are to stand any chance against the forces arrayed against them.

We are today reduced to being spectators of a daily puppet show in the guise of a morality play.

When a country’s ‘leadership’ fails to address fundamental existential issues at home it can have no external policy to speak of. The rest of the world sees this and refuses to take its foreign policy seriously, however well articulated and reasoned it may be. Pakistan has itself become a major stumbling block to the success of its principal foreign policy issue: a principled, peaceful and lasting settlement of the Kashmir dispute with India that is primarily and ascertainably acceptable to the Kashmiri people.

Editorial: New PM’s challenge

The Kashmiri people cannot defeat India although they have so far heroically denied it the victory it strives for. Pakistan cannot defeat India although its nuclear deterrence capability limits India’s military options. A diplomatic stalemate maximises the suffering of the Kashmiri people. The world is aware of India’s perfidy in Kashmir but is simply not inclined to back a failed or failing Pakistan against the gigantic market and strategic value of what will soon be the world’s most populous country. China, for obvious reasons will continue to back Pakistan against India, while increasingly worried about Pakistan’s inability to learn anything from the amazing experience of its most reliable friend.

The US sees Pakistan as a resentful puppet ruled by dependent elites who will do its bidding even it undermines the confidence of China in Pakistan’s resilience and strategic value.

In Afghanistan, Pakistan backs the Taliban which backs the TTP which perpetrated the massacre of schoolchildren and teachers in the Army Public School on Dec 16, 2014. The army today engages with the TTP, which is essentially a Pakistani branch party of the Afghan Taliban, while refusing to engage with the Pashtun Tahaffuz Movement of Manzoor Pashteen which is a Pakistani movement because of its protests against the bombing of Waziristan.

Pakistan has practically no support among the Afghan political intelligentsia, particularly the educated youth who are the future of the country. India has the field to itself.

These absurdities are the direct result of the state of the state in Pakistan. Unless this state of affairs is addressed, foreign policy, indeed all other aspects of national policy, will not be able to develop coherence and credibility. This is all too clear to political observers in Pakistan. But they are by and large easily resigned to the prospect that this state of affairs will not be addressed — and that they will themselves be complicit in this dereliction of duty, citizenship and patriotism. Unless we await a deus ex machina.

The writer is a former ambassador to the US, India and China and head of UN missions in Iraq and Sudan.
ashrafjqazi@gmail.com
www.ashrafjqazi.com

Published in Dawn, July 29th, 2022

PAKISTAN
Is this a crisis like none other?

Reza Baqir

FOR crisis managers, each economic crisis appears like none other. The perception of our current economic challenge and the commentary around it seems no exception.

This is at least the third pronounced economic challenge that our country has faced in the past three years. The spring and summer of 2019 were marked by sharp uncertainty about our economic future and about whether Pakistan would turn yet again to the IMF. In July 2019, when the IMF finally announced a $6 billion programme — of which we are scheduled to receive the seventh and eighth tranche this August — it noted that Pakistan’s economy was “at a critical juncture” and was “facing significant economic challenges on the back of large fiscal and financial needs and weak and unbalanced growth”. A combination of measures that were undertaken then soon restored stability. The rupee strengthened four per cent between end-July 2019 and end-February 2020 — just before the start of Covid-19 — to Rs154 to the dollar and gross reserves rose by about $5 billion over the same period.

Read: Better crisis management

Just when economic stability was restored after the 2019 balance-of-payments crisis, we were struck by a second crisis in March 2020 that appeared truly unprecedented at the time. The IMF managing director Kristalina Georgieva declared about the Covid-19 crisis that “a global crisis like no other needs a global response like no other”. Indeed, the world had not seen such a confluence, and at such a scale, of both public health and economic challenges. Pakistan responded to this crisis with innovative and timely measures that saved lives and livelihoods and engendered a quick economic recovery. For a country that was historically prone to economic mismanagement, our response to Covid-19 was noted internationally for its targeted cash transfer scheme under Ehsaas to protect the poor and for the government and central bank’s proactive economic measures. Moreover, unlike most countries where public debt rose significantly during Covid-19, we were able to reduce our public debt-to-GDP ratio by about five percentage points through Covid-19.

The perceived absence of political clarity is casting a shadow over most economic decisions.

Given that we successfully restored stability and growth in the recent two challenging crises, why is there not a shared sense of calm confidence that we should be able to do the same this time round? This question is particularly relevant because our reserves and public debt are better today than they were in the 2019 balance-of-payments crisis before the start of the IMF programme. At end-June 2019, our gross reserves had dipped to around $7bn; at end-June 2022 they were around $10bn. The State Bank’s forward liabilities, including swaps, which are a measure of possible short-term net drains on reserves, were about $8bn back then; today they are about $4bn. In effect, our quality of reserve buffers is about $7bn better than it was then. Our average monthly current account deficit in the first half of 2019 was approximately in the same range as it is today, notwithstanding that oil prices are about $40 higher today. Moreover, our public debt is estimated at 75pc of GDP at June 2022 compared to around 80pc two years earlier. The KSE-100 index of the stock market, more a function of sentiment and other factors than fundamentals, sank to around 27,000 in 2019 and again during Covid; today, it is around 40,000.

Yet despite these better indicators, the perception is that this crisis is like none other. There are three primary reasons why, despite having successfully navigated two significant crises in the past two years and our fundamentals being better, this economic challenge appears worse.

First, is the current political tension and its associated implications for uncertainty around future economic policymaking. Back in 2019 and again during the Covid-19 crisis, there was little ambiguity regarding the near-term future of the political set-up. Today, the perceived absence of political clarity is casting a shadow over most economic decisions. Further, each new political development opens up more permutations around the future course of decision-making.

Second, global interest rates are much higher today than they were either in 2019 or during Covid-19. This is significant because it directly impacts the viability of us borrowing commercially to meet our external financing needs. Ten-year US interest rates were around 2pc in the mid-2019 which fell to 0.5pc during the Covid-19 crisis. Today, they are around 3pc. Moreover, the premium over the US interest rate for borrowing by emerging markets has risen sharply.

And finally, today, unlike in the last two recent crises, there are significant spillovers from other high-debt countries experiencing debt distress such as Sri Lanka. Even if Pakistan’s fundamentals may be better on some counts, having the misfortune of being considered similar in perceptions of economic management is enough to cause concern. Further, it does not help that Pakistan gets included in lists drawn up by prominent international outlets of countries under the risk of debt distress. And the recent downgrades of our economic outlook by all three credit ratings agencies — despite the recently announced IMF staff-level agreement — gives further inclination to analysts to lump us with debt distress cases.

Where does this lead us in terms of the outlook? The bad news is that of the three factors above only the first — domestic political stability — is in our control or at least in the control of some stakeholders in our country. The other two factors — global interest rates and spillovers from other countries that will continue to fall into debt distress — will likely persist in the coming months. In any event, their evolution is not in our control.

The good news is that the first factor may be the most important that can restore stability. If key economic stakeholders come to conclude that a particular political constellation — whichever constellation that may be — is going to remain stable for the foreseeable future, they may be more inclined to reach the more plausible conclusion that the perception of our current economic problems is worse than the reality.

The writer is former governor of the State Bank of Pakistan.
Twitter: @rezabaqir

Published in Dawn, July 31st, 2022

PAKISTAN

Our atoms for peace

Riaz Riazuddin

PAKISTAN is among eight countries of the world that possess nuclear weapons. This puts our country in the category of nuclear elites like the US, Russia, UK, China, France, India and North Korea. While our atoms for deterrence have made us secure from external aggression, our energy security continues to be at risk because of the country’s high dependency on fossil fuels. This hardly bodes well for a nuclear power.

Our country also produces nuclear power for peaceful purposes, along with 31 other nations that use nuclear reactors to generate electricity. The current geopolitical environment, with the Russia-Ukraine conflict, points to the need for increasing use of nuclear energy for peaceful uses and reducing reliance on fossil fuels.

‘Atoms for peace’ refers to a speech by Eisenhower to the UN in 1953 that subsequently resulted in the establishment of the International Atomic Energy Agency (IAEA) in 1956.

The white man’s burden manifests itself strangely. The guilt of bombing Nagasaki, if not necessarily Hiroshima, drove Gen Eisenhower to ‘civilise’ the rest of the world with the splitting of atoms. He proposed “… to devise methods whereby this fissionable material would be allocated to serve the peaceful pursuits of mankind. Experts would be mobilised to apply atomic energy to the needs of agriculture, medicine, and other peaceful activities. A special purpose would be to provide abundant electrical energy in the power-starved areas of the world”.


The IAEA incorporated Eisenhower’s proposal in its statute with the objective “to accelerate and enlarge the contribution of atomic energy to peace, health, and prosperity throughout the world. It shall ensure, as far as it is able, that assistance provided by it or at its request or under its supervision or control is not used in such a way as to further any military purpose”.

Under the Atoms For Peace programme, the US supplied a 5MW swimming pool-type research reactor which was later upgraded to 10MW. This and another 27MW research reactors are used by Pinstech under the auspices of the Pakistan Atomic Energy Commission for R&D, teaching and training, according to the PAEC website.

Read: Let’s go nuclear — safely

Whenever we think of nuclear power, images of mushroom clouds and the tragic destruction of Hiroshima and Nagasaki come to mind. Images of nuclear testing over the coral reef of Bikini Atoll in Marshall Islands may also appear.

The US forcibly relocated the atoll’s inhabitants and detonated 23 nuclear weapons from 1946 to 1958, making the atoll inhabitable. Radiation levels are still extremely high and unsafe for living there.

French ingenuity took the name ‘bikini’ and introduced a two-piece swimsuit. This was initially banned both in France and Germany but gained popularity when great actors embraced it, so much so that France later became intolerant of the burkini and burqa. Is this the French version of the white man’s burden? Swimming pool-type research reactors, nuclear detonations, bikinis and burkinis are strangely connected!

Pakistan produces nuclear power for peaceful purposes along with 31 other nations.

Coming back to atoms for peace, which country produces most of its electricity from nuclear reactors? It is France which seems the least afraid of radiation but the most afraid of the burqa and its variants. It produces 69 per cent of its total electricity through nuclear reactors, supplying 363 GW of electricity.

While the US produces the highest amount of nuclear electricity at 772GW, the share of the latter in the country’s total electricity generation is only 20pc, according to the IAEA in 2021.

Pakistan generated 15.8GW of electricity from its reactors in 2021, which amounts to 10.6pc of its total electricity. Other sources like water and coal and other fossil fuels contributed 89.4pc. Among 32 countries, Pakistan ranks 18th in terms of nuclear electricity generated in 2021 and 22nd in terms of the share of total electricity produced.

Pakistan is unique in terms of nuclear testing. It did not explode its device in the open air or under the sea. It detonated it under the base of a mountain in Chaghi. Many of us would have seen the proud moment when the mountain turned a flammable orange. The video clip which shows the test ends quickly. Viewers like me keep wondering whether the mountain was crushed or still stands. What are the current radiation levels in the region? Although the answer is not relevant to the topic, but curiosity demands comparison with testing at Pokhran and Bikini Atoll. I am sure our able nuclear scientists have done useful research in this area. We must have a unique data set related to our successful test in 1998.

If we have achieved such a big feat, it should not be too difficult to rely more on nuclear reactors to provide abundant electrical energy for the country’s power-starved areas.

Nuclear electricity is environment-friendly, and the EU has recently declared it as green. The low carbon nature of nuclear energy is well recognised, and it can help mitigate climate change. It is also cost-competitive in the long run. Its average tariff is only Rs9.25 per unit compared to Rs14.80 for oil, according to the PAEC. This cost is the second lowest after hydroelectricity.

Since we cannot purchase uranium from world markets due to sanctions, we must rely more on our relations with China, which has already supplied not only civilian nuclear reactors (operating in Chashma and Karachi), but guaranteed fuel supply for their entire lifespan of 60 years. We also must search for indigenous uranium for extraction.

What made us capable of detonating a nuclear device through a home-grown research programme? First, political commitment and support. Second, putting the most competent person in charge. Third, giving that person and the institution full operational independence. Fourth, promoting a culture of merit and appointing the most competent persons, without regard to ethnicity, etc. Fifth, monitoring progress continuously, while ensuring continuity in the first four steps.

Bhutto saw to the first, second and third. Later political leaders and key military personnel provided support. And our hero Dr Abdul Qadeer Khan and his team did the rest. Why cannot we replicate this approach of merit and competency in every sphere of government and other institutions to run our country?

The writer is a former deputy governor of the State Bank of Pakistan.
rriazuddin@gmail.com

Published in Dawn, July 21st, 2022

OPTIMIST

UN chief warns humanity ‘one miscalculation away from nuclear annihilation’

AFP Published August 1, 2022

UN Secretary-General Antonio Guterres addresses the 2022 Review Conference of the Parties to the Treaty on the Non-Proliferation of Nuclear Weapons at the United Nations in New York City on August 1, 2022. — AFP

UN head Antonio Guterres warned Monday that the world faced “a nuclear danger not seen since the height of the Cold War” and was just “one miscalculation away from nuclear annihilation.”

“We have been extraordinarily lucky so far. But luck is not a strategy. Nor is it a shield from geopolitical tensions boiling over into nuclear conflict,” Guterres said at the start of a conference of countries belonging to the nuclear Non-Proliferation Treaty (NPT).

“Today, humanity is just one misunderstanding, one miscalculation away from nuclear annihilation,” he said, calling on nations to “put humanity on a new path towards a world free of nuclear weapons.”

Guterres’s comments came at the opening 10th review conference of the NPT, an international treaty that came into force in 1970 to prevent the spread of nuclear weapons.

The meeting, held at the UN’s headquarters in New York, has been postponed several times since 2020 due to the Covid-19 pandemic. It will run until August 26.

Guterres said the conference was “a chance to strengthen” the treaty and “make it fit for the worrying world around us,” citing Russia’s war in Ukraine and tensions on the Korean peninsula and in the Middle East.

“Eliminating nuclear weapons is the only guarantee they will never be used,” the secretary-general implored, adding that he would visit Hiroshima for the anniversary of the August 6, 1945, atomic bombing of the Japanese city by the United States.

“Almost 13,000 nuclear weapons are now being held in arsenals around the world. All this at a time when the risks of proliferation are growing and guardrails to prevent escalation are weakening,” Guterres added.

In January, the five permanent members of the UN Security Council — the United States, China, Russia, Britain, and France — had pledged to prevent the further dissemination of nuclear weapons.

At the last review conference in 2015, the parties were unable to reach an agreement on substantive issues.

Tunisia library races to preserve rich polyglot press archive

By AFP
Published August 1, 2022

An employee at the National Library of Tunisia consults scanned documents -

Copyright AFP Fethi Belaid
Tom Little

In the basement of the National Library of Tunis, conservator Hasna Gabsi combs through shelves of newspapers dating back to the mid-19th century to select the latest to digitise.

She picks out a yellowed copy of an Arabic-language newspaper printed in the 1880s, then walks to the sections containing French, Italian, Maltese and Spanish-language newspapers published in Tunisia.

“The archive is a witness to an important, historical culture,” Gabsi said under the flickering neon lights.

The library’s collection includes some 16,000 titles printed in Tunisia — numbering hundreds of thousands of editions of newspapers and periodicals.

As part of a campaign to preserve the country’s archives, the library staff have been working to digitise the documents.

Most of the newspapers are in Arabic, with the oldest from the mid-19th century when Tunisia was an Ottoman province.

After France occupied Tunisia in 1881, European settlers published periodicals in several languages, including French, Italian, Spanish and Maltese.

Some publications are even in Judeo-Arabic, a local Arabic dialect written in the Hebrew alphabet.

Gabsi selects a copy of Voix d’Israel, a Hebrew-language newspaper printed by Tunisia’s Jewish community, which numbered around 100,000 when the country gained independence from France in 1956.

Further along the shelves, she picks out L’Unione, published in 1886 by an Italian community that would number some 130,000 by the middle of the following century.

Nearby, technicians use huge scanners to digitise the newspapers and other documents, which have been made available to the public online since May.

The library’s director Raja Ben Slama has brought together a team of around 20 employees to accelerate the process.

She said the importance of preserving the newspapers was clear to her when she arrived in 2015.

“We are in a race against time with the elements against the deterioration of the periodicals,” she said.

Some of them “can’t be found anywhere else”, she added.

Many of the publications have disappeared, particularly those published in Italian, Hebrew and Maltese.

Economic woes and tensions sparked by the Arab-Israeli conflict led to the departure of most of the country’s Jewish community, while most Italians left in the years after independence.

For historian Abdessattar Amamou, the archives are rare in the region, reflecting the “mosaic” of different communities that were present in the North African country.

“At the dawn of independence, we were three million people — but with that came a huge richness on the level of the press,” Amamou added.

CIRCULAR ECONOMY

How People Profit Off India’s Garbage | World Wide Waste | Business Insider

Jul 27, 2022

India has more people and produces more garbage than nearly every other country in the world. Many make a living off that waste, from ragpickers to entrepreneurs. Join us as we look at how they turn trash into shoes, tiles, teddy bears, and more.

 

How a robot recycles our electronic waste – BBC News

Jul 31, 2022

 It’s estimated that the amount of e-waste generated last year was more than 57m tonnes.

Phone recycling is on the rise, but most handsets still end up in landfill sites, reports BBC technology programme Click. The majority of modern smartphones contain about 30 elements, including rare earth materials such as gold and tin. The World Economic Forum has warned that some elements could be completely depleted in 100 yeas.

• PROUDHON'S PEOPLES BANK

• Credit unions battle big banks to attract younger Canadians

Leah Golob, 

The Canadian Press  

Jul 26, 2022

Kayla Rourke's first banking experience was with Conexus Credit Union but left to try the Bank of Nova Scotia in her teens, hoping to take advantage of the Scene points program to earn free movie tickets.

She later tried another bank or two but eventually, the 29-year-old Regina-based teacher returned to Conexus five years ago because of its no-fee chequing account, customer service and focus on helping local communities. In 2021, for example, the credit union reinvested more than $1.9 million back into Saskatchewan communities through their Community Investment Program.

“I feel really happy staying with a credit union because I want to make life better where I live,” Rourke said.

“It feels like at a bank I’m always trying to be sold something,” she added. “I feel like at a credit union, I’ve had such good discussions on how to build wealth or save for particular goals while keeping it realistic. I love how they’ve checked in with me to see how it’s going … I feel like at a bank I was a customer and at a credit union, I feel like a client.”

Disha Soni, a 32-year-old self-employed financial adviser, said in her case it made more sense to go with a bank rather than a credit union because they’re well known around the globe and have many physical branches.

“They are well established and I had more confidence giving them my money,” she said. Soni, who immigrated to Ottawa in November 2021, was also attracted by the offers that banks have for newcomers.

In recent years, the Canadian Credit Union Association has been promoting credit unions to millennials and Generation Z. According to a report entitled “Credit unions and millennials” published by MNP, attracting and retaining millennials and Generation Z is vital to sustaining the Canadian credit union system, especially as it faces an aging member base. 

Ipsos’s Customer Service Index Survey conducted over 2021 revealed that 59.2 per cent of credit union members are over the age of 55. Only 12 per cent of credit union members, on the other hand, were 18 to 34 years old. 

With banks, the survey showed that 17.5 per cent of customers are 18 to 34 and 45.6 per cent of customers are 55 and over. 

Annette Bester, national leader of credit union services at MNP, said there’s a lot of education that needs to be done around credit unions to spread awareness on what they are and what they do. This awareness can vary by geography, she said.

For example, while credit unions are more known in parts of the country such as Saskatchewan, there may be less awareness in Ontario, where most of the country's major banks are headquartered. 

There are some misconceptions about credit unions, such as if you join a credit union that operates in one province, you won’t be able to access funds elsewhere if you’re travelling, Bester said.

“Credit unions have access to ATM networks across the world and they’ve got mobile banking apps. They’ve got all the same things that the big banks do but maybe it’s not known,” she explained.

Credit union members can use any ATMs that belong to the Exchange Network free of charge but will have to pay a surcharge using ATMs that are not part of the network. 

Pamela George, a financial literacy counsellor at Sand Dollar Financial Literacy, said the biggest downfall for credit unions is that they don’t have a big budget for marketing like banks do.

Otherwise, both George and Bester believe that the financial co-operative, community-focused nature of credit unions would be appealing to young people if they understood more about how they worked. 

For example, customers of credit unions are called members, and profits go back to the credit union to help set up better interest rates and lower fees for members, George said. 

Where banks have the upper hand is with better technology on their apps and websites. They lead the way in this area, George said. 

When deciding the right fit for them, young people will have to weigh digital technology and the availability of physical locations Canada-wide against whether they’d want to bank with a financial co-operative with a community focus. 

Proudhon and his "Bank of the People" - Anarchy Archives

http://dwardmac.pitzer.edu › proudhon › dana

M. Proudhon is about five feet eight inches high, of rather clumsy person. His hair is light, his complexion fresh, his eyes blue and keen, and ...

IRVING INC. TO TAKE OVER

Postmedia chairman Paul Godfrey to step down from role at end of year

The Canadian Press

Jul 28, 2022

Paul Godfrey speaks during the company's annual general meeting in Toronto on Thursday, January 12, 2017. , THE CANADIAN PRESS/Nathan Denette

Postmedia chairman Paul Godfrey is stepping down from his role at the end of the year, the company announced Thursday. 

SCION OF IRVING INC.

Current board member Jamie Irving will step into the job at the start of 2023. Irving has sat on the company's board since April, when Postmedia acquired Brunswick News Inc., the media arm of the Irving family empire, for $16.1 million in cash and shares.

Godfrey will serve as a special adviser to the board and CEO following the end of his term as chair. 

He was the founding CEO of Postmedia.

Andrew MacLeod, the company's president and CEO, says Postmedia would not exist if not for Godfrey's "leadership and vision." 

U$ TARIFFS

A forgotten Canada-U.S. lumber spat seen adding costs to U.S. homes

Jen Skerritt, 

Bloomberg News

Jul 28, 2022

A lingering trade dispute between the US and Canada is expected to keep tariffs on softwood lumber in place, adding to soaring inflation costs.

The US is expected to lower duty rates on Canadian softwood lumber in a ruling next week, but not get rid of them, said Susan Yurkovich, president of the BC Lumber Trade Council. That means Canadian companies will still have to pay tariffs hovering near 11 per cent, heaping more costs on American homebuilders and buyers, she said.

The Trump administration slapped tariffs on Canadian softwood lumber in 2017, saying the industry is unfairly subsidized. The US raised rates on imports in 2021 even as an unprecedented rally lifted prices to record highs during a pandemic-fueled homebuilding and renovation boom. US builders get more than a quarter of their lumber from Canada, the world’s largest softwood lumber exporter. 

West Fraser Timber Co. Chief Executive Officer Ray Ferris said Thursday “there doesn’t appear to be anything meaningfully happening” to resolve the spat. 

“It’s very frustrating particularly at a time when lots of people are facing a lot inflationary pressure,” Yurkovich said in an interview. “The US industry is putting an additional tax on consumers.”

Canada claims victory on EV tax credits in Manchin-Schumer deal

Brian Platt, Bloomberg News

Jul 28, 2022

Prime Minister Justin Trudeau’s top trade official claimed a diplomatic victory for Canada on US electric vehicle tax credits proposed in a deal between senators Chuck Schumer and Joe Manchin.

In a statement on Thursday, Trade Minister Mary Ng said her government’s advocacy played a role in preventing these credits from being restricted to vehicles built by unionized US workers.

The Senate deal announced on Wednesday revives much of President Joe Biden’s tax and climate agenda, but the legislation changes the language on the tax credits so they apply to vehicles built in the North American auto industry, not just in the U.S.

“It took Team Canada advocacy for us to get here,” Ng said in an emailed statement. “Since the Prime Minister’s first meeting with President Biden last year, we have been relentless in underscoring that the original proposal would be harmful to both Canada and the US, so we’re glad to see that recognized in the new version of the bill.”

Canadian officials had made a major diplomatic effort over the winter to argue the original version would roll back decades of integration in the North American auto sector. Mexico’s government also slammed the initial proposal, calling it self-defeating for the US.

The original version of the tax credits, which were in Biden’s Build Back Better bill, was also opposed by companies such as Tesla and Toyota, who argued it gave an unfair advantage to the Detroit-based automakers and their unionized factories. 

The new legislation, which could still change as it moves through Congress, will allow carmakers to continue offering US$7,500 in tax credits for the purchase of new “clean cars” with some conditions: they will need to be built with minerals that are extracted or processed in a country the US has a free trade agreement with, and have a battery that includes a large percentage of components that were manufactured or assembled in North America.