US And Canada Sign Government Procurement Agreement

(Steel Business Briefing/American Iron & Steel Institute)

Despite objections from the Ontario Federation of Labour, Canada and the US have signed a government procurement agreement with the hopes of ending Canada’s problem with the “Buy America” clause in the US Economic Recovery and Reinvestment Act of 2009.

The agreement gives US firms permanent access to Canadian provincial and territorial procurement contracts consistent with the WTO’s Government and Procurement Agreement (GPA). American companies will also be able to compete for Canadian construction contracts not covered under the GPA through September 2011, Steel Business Briefing understands.

In turn, the US will provide reciprocal access for Canadian companies to 37 US states already covered by the GPA, but will only give access to “a limited number of Recovery Act programs,” according to a statement from the US Trade Representative’s office.

The two countries are also committed to exploring a long term government procurement agreement within the next 12 months “to deepen on a reciprocal basis, procurement commitments beyond those in the WTO GPA and NAFTA,” says the Foreign Affairs and International Trade Canada website.

“This agreement resolves key outstanding US-Canada government procurement issues and creates tens of billions of dollars worth of new job-supporting export opportunities for American companies and workers,” commented USTR Ron Kirk.

As SBB reported, the Ontario labor group objected to some US-favoring terms of the agreement and was encouraging the Canadian government to reject it, calling it “unfair” and “lopsided.” The group could not be reached for comment over the weekend.