Feds and provinces offer U.S. firms 'guaranteed access' on procurement
By The Canadian Press
OTTAWA - The federal and provincial governments are offering American firms "guaranteed access" to Canadian procurement contracts in return for a waiver on Buy American provisions in the U.S. economic stimulus package.
International Trade Minister Stockwell Day sent the offer - which he said was "time-limited" - to U.S. trade representative Ronald Kirk in a letter obtained by The Canadian Press.
The letter, sent Thursday, notes that only federal procurement commitments are covered under the North American Free Trade Agreement and the World Trade Organization.
Day wrote that "as such, our procurement commitments do not reflect the realities of our increasingly integrated markets."
"To address this gap, Canada's proposal also seeks a commitment to explore the scope for a permanent, reciprocal government procurement agreement."
The letter mentions a preliminary discussion between the parties took place on Tuesday, but it was not immediately clear whether the proposal would lead to a resolution of an ongoing trade spat.
Provincial and local governments across Canada have complained bitterly that Canadian firms are being excluded by their American counterparts from bidding on billions of dollars worth of stimulus projects that are being funded by the U.S. federal treasury.
The Buy American provision gives preference to U.S. producers of iron, steel and other building blocks of public-works recovery efforts.
Ontario Premier Dalton McGuinty urged municipal politicians this week to pass council resolutions denouncing protectionism.
"Buy American means Canadian businesses can't bid on U.S. infrastructure projects," said McGuinty. "But they can bid on ours. That's not fair. That's protectionism."
The Canadian government, in collaboration with the provinces and territories, is offering "time-limited guaranteed access to an ambitious package of sub-federal procurement." In return, states the letter, Canada would get a waiver from the Buy American clauses in the U.S. Recovery Act, and from any new laws in the same vein.
Day said he has appointed a lead negotiator, Don Stephenson, assistant deputy minister of trade policy and negotiations, to pursue the offer. He has asked the U.S. government to name a counterpart.
"I trust we will be able to instruct our officials to move forward in the coming days to arrange a first meeting in Washington, D.C., where my officials can present the details of our proposal, once a senior U.S. lead negotiator has been identified."
U.S. President Barack Obama, while decrying protectionism, has appeared powerless to curb the Buy American restrictions.
At a meeting of North American leaders in Mexico earlier this month, Obama downplayed Canadian frustration over the provisions, arguing that complaints about U.S. protectionism were over the top.
"I want to assure you that your prime minister raises this every time we see each other," Obama told a news conference as the summit wrapped up.
"I think it's also important to keep it in perspective: We have not seen some sweeping steps towards protectionism."
Obama said the Buy American provision was perfectly legal, even if he doesn't personally like the measure.