Business groups want new trade deal to combat ‘Buy American’ laws

OTTAWA — Canada and the United States need to negotiate a new free-trade agreement on government procurement to head off a trade war over the Buy American issue, business leaders said Monday.

OTTAWA — Canada and the United States need to negotiate a new free-trade agreement on government procurement to head off a trade war over the Buy American issue, business leaders said Monday.

In a letter to the premiers and the federal government, Canada’s top business groups say Canadian contractors are being excluded from state and local procurement markets in the United States.

And a movement among Canadian municipalities to fight fire with fire by discriminating against American contractors could ignite a trade war that would hurt both sides, the groups say.

The groups, which include the Canadian Manufacturers and Exporters, the Canadian Chamber of Commerce and the Canadian Council of Chief Executives, say the solution is an open market in government procurement, particularly at the municipal and provincial-state levels currently not covered by the North American Free Trade Agreement.

“We can, I think, come to a bilateral agreement with the United States that says our two countries will not discriminate against each other in sub-national procurement, enshrine it and make sure it sticks,” said Perrin Beatty, head of the Canadian Chamber of Commerce.

The letter is especially targeted to the premiers, said Jayson Myers of the manufacturers association, whose members are on the firing line of Buy American laws because such an agreement affects their ability to direct contracts to local suppliers.

The issue was on the agenda at a meeting of federal and provincial trade officials in Yellowknife on Monday.

“Our government is doing everything possible to resolve this situation. We are taking action on a number of fronts, including engaging the provinces and territories,” said federal Trade Minister Stockwell Day.

Business groups on both sides of the border have lobbied against Buy American clauses in U.S. federal stimulus bills.

Two Toronto-area firms — Hayward Gordon Ltd., and Belgian-owned Ipex Inc. — have complained they are being shut out of the U.S. market. In the case of Ipex, the firm’s plastic pipe was ripped from a sewage line in California after it was found to be made in Canada.

But many believe the problem is much broader and that many Canadian firms prefer to lobby behind the scenes rather than cry foul publicly.

In response, some Canadian municipalities are proposing to respond in kind to Buy American by shutting out suppliers from countries that discriminate against Canada.

The Federation of Canadian Municipalities will vote on a resolution brought forth by Halton Hills council in Ontario later this week. The resolution would have cities and towns discriminate against U.S. suppliers as long as the Buy American laws remain in place.

“It’s an effective stick … and I think it gives us a powerful negotiating position,” said Myers of the Halton Hills resolution.

“But nobody wants trade wars. Nobody wants protectionism either.”

That is the message U.S. Chamber of Commerce chief executive Tom Donohue delivered to President Barack Obama in a recent letter, specifically citing the Canadian municipalities resolution as a example of how protectionism can rebound against American interests.

“In water and wastewater infrastructure, Canadian firms are now being excluded from U.S. municipal contracts,” Donohue wrote.

“Retaliation by Canadian municipalities could result in US$3 billion in lost business for U.S. water and wastewater equipment manufacturers.”

Mexico has already taken action in retaliation of their trucking industry being denied access into the U.S., often targeting protectionist lawmakers’ districts.

Myers said Canada stands to lose little from guaranteeing free trade in provincial and municipal procurement because in practice, there are few restrictions on American suppliers.

Just Posted

Blood donations needed in Central Alberta: Canadian Blood Services

357 donors are needed before Aug. 26 at the Red Deer clinic

Warkentin seeks UCP nomination

Another nominee for Red Deer North

UPDATED: Red Deer air quality risk rated high

Poor air quality and reduced visibility

WATCH: Annual Family Picnic at Central Spray and Play

Blue Grass Sod Farms Ltd. held the Annual Family Picnic at the… Continue reading

Boy, 11, dies after being struck by payloader on southern Alberta ranch

BOW ISLAND, Alta. — A boy has died after an accident on… Continue reading

Liberals look at creating federal holiday to mark legacy of residential schools

OTTAWA — The federal Liberal government wants to establish a holiday to… Continue reading

Thousands of police officers expected at regimental funeral in Fredericton

FREDERICTON — Thousands of police officers and first responders from across the… Continue reading

B.C. declares state of emergency over wildfires

VICTORIA — The British Columbia government has declared a provincial state of… Continue reading

As service refusals make headlines, experts say businesses usually in the wrong

Two Canadian businesses that recently made headlines for refusing customers have learned… Continue reading

Irregular asylum claims increased in July after two months of decline

OTTAWA — The number of irregular border crossers in Canada went up… Continue reading

Knocking down statues no way to address a troubled history, McKenna says

OTTAWA — The minister responsible for Parks Canada says tearing down statues… Continue reading

Turning on Trump doesn’t buy credibility for black Americans

WASHINGTON — For years, Omarosa Manigault Newman stood at Donald Trump’s side,… Continue reading

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month