Editorial: Not Yet Decisive Victory

(The Globe & Mail)

The federal government is to be congratulated for finally getting a deal allowing Canadian companies to bid on more American stimulus projects. But the deal came after great delay, and therefore at great cost. Moreover, Buy American is not dead; the deal is not ironclad, and many aspects are not permanent, or do not apply to other American governmental spending. More than ever, the Canadian government must be vigilant and make a strong case that, despite the recession, freer trade is ultimately in both countries' interests.

The deal comes just before the first anniversary of the passage of the U.S. stimulus bill, which largely forbade the use of Canadian iron, steel and manufactured goods in stimulus projects. Since then, much damage has been done. As little as $18-billion (U.S.) in stimulus funds may be left for Canadian companies to bid on, and the deadline for project decisions to be made is less than two weeks away. Although many contracts will be signed after that date, many Canadian companies have already been disadvantaged by being shut out for so long.

Even then, the victory is not a complete one. Only 37 American states are included. Both sides reportedly threw protective blankets over major sectors: transportation and energy in Ontario and federally funded transportation projects in the United States. Read more here.

Related: Silver Lining Outshines Any Clouds in Buy American Deal, Ont. Premier Says (Globe & Mail)