Canadian Trade Minister Jim Peterson said Tuesday he was encouraged by the US decision to cut duties on imported Canadian softwood lumber, calling it "an important step" that supports "Canada's long-standing position."

"The government of Canada welcomes this important step by the US," the minister said in a news release. "This is a positive move and one that Canadians should rightly see as a vindication of our strong position."

However, Peterson noted that "a complete victory will not have been secured until the duties improperly collected have been returned, until all duties are eliminated."

He also said Canada will continue to explore every reasonable option to resolve the dispute, and will aggressively seek export opportunities for softwood lumber in other markets.

Earlier Tuesday, the US Commerce Department said it will comply in part with a panel ruling of the North American Free Trade Agreement (NAFTA) to cut penalties on Canadian softwood lumber.

Despite its action, the US Commerce Department said it retains its right to appeal the NAFTA ruling.

The NAFTA panel has repeatedly told Washington to eliminate punitive duties on Canadian lumber, but the United States has not complied, pointing to a recent contradictory ruling in its favor from the World Trade Organization, which Canada is appealing.

Canada supplies about 6 billion Canadian dollars (5 billion US dollars) in softwood to the United States each year, mostly for housing construction.

The US imposed countervailing and anti-dumping duties on Canadian softwood lumber in 2002, accusing the Canadian government of subsidizing the exporters, which Ottawa denied.

Canada said a total of 5 billion Canadian dollars (4 billion US dollars) has been unfairly collected over the past three years, and it has been demanding that the money be returned and the duties eliminated.

Source: Xinhua