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A recent historical perspective of increasing trade restriction in wood products : case study of the United States, Europe and Japan

University of British Columbia

Despite efforts to liberalize trade by reducing tariffs, there has been an increased use of Non- Tariff Measures (NTMs) to protect domestic industries circumventing efforts for liberalized international trade. This study explores the use of NTMs to uncover a mechanism that underlies the implementation of NTMs as a global trend. The case study method was used to accomplish this purpose and three regions, the United States (US) and the European Union (EU) and Japan were selected as study cases. The US and EU have implemented NTMs while Japan has not. These cases provide important information to not only understand the role of NTMs but also uncover a framework for their implementation. This framework shows that the protectionist movement is triggered by economic recession. It is then amplified by process and product innovation. The cases are restricted to the softwood lumber sector but the framework may be applicable in a larger context. In the US and EU, the economic recession of the late eighties led to oversupply of product and the adoption of process innovation to improve productivity and profitability during low prices. This exacerbated oversupply and led to sawmill closures and increased unemployment while the sawmills that increased capacity remained. These conditions contributed to a strong protectionist movement and the implementation of protectionist policies in both regions. While new production created oversupply, newly innovated products, such as Engineered Wood Products (EWPs), captured an increasing share of conventional softwood lumber markets. This substitution contributed to the oversupply of lumber in the market by effectively shrinking the market. Since international agreements prohibited the implementation of tariffs, NTMs, which were less regulated by international trade rules, were adopted to protect and/or promote the domestic industry. Japan has not adopted innovative process technology despite the reduction in sawmills and the reoccurrence of recessions. This may be the reason that Japan has not explored NTMs but is considering safeguard measures under WTO guidelines.

Thesis/Dissertation

application/pdf

2009-08-13

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http://hdl.handle.net/2429/12146

Forestry

University of British Columbia

UBCV

DSpace