Buy American deal needed this month: Canada industry

Thu Jan 14, 2010 6:50pm EST
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By Doug Palmer

WASHINGTON (Reuters) - Canada needs to reach a deal with the United States this month to exempt its companies from a "Buy American" measure or the agreement could become effectively worthless, a Canadian industry official warned on Thursday.

"From the Canadian point of view, we have to see a successful conclusion of these negotiations soon. I would say by the end of this month," Jayson Myers, president of Canadian Manufacturers and Exporters, said during a panel discussion on a provision of last year's U.S. economic stimulus package that has strained trade ties with Canada.

Myers said he believed the two sides would reach a deal.

But the longer the negotiations take, the "less and less valuable" an agreement is for Canada because the bulk of public works contracts under the $787 billion American Recovery and Reinvestment Act already will have been locked up, he said.

The Buy American provision requires projects funded by that act to use only U.S.-made products such as steel. The measure was touted as a way to ensure funds spent under the mammoth package would create jobs in the United States.

Critics say it threatens jobs at U.S. companies that rely on global supply chains to manufacture goods, boosts stimulus costs and creates project delays.

In response to international outcry about the measure, Congress exempted countries including Canada that have opened their government procurement markets to the United States.

But that does not spare Canadian provinces and cities, which are not party to any government procurement pact with the United States, even though the country's federal government is.   Continued...