(The Canadian Press – Lee-Anne Goodman)
Opponents of the Obama administration’s so-called Buy American provisions are working furiously this summer under a Canadian deadline, trying to convince legislators to do something about the protectionist measure before a full-fledged trade war erupts.
Their efforts come despite recent Environmental Protection Agency directives reminding local utilities that they need not concern themselves with NAFTA obligations as the federal watchdog also issued stern warnings about Buy American non-compliance.
“We’re all under the Canadian clock,” Dawn Christof-Champney, president of the Waste and Wastewater Equipment Manufacturers Association, said Monday. Champney was referring to the 120-day deadline issued by the Federation of Canadian Municipalities on June 6. It gives the U.S. 120 days to exempt Canada from the Buy American provisions in President Barack Obama’s $787 billion economic stimulus package, or Canadian municipalities will begin shutting out U.S. firms from bidding on local contracts.
Various stakeholders opposed to Buy American, including blue-chip American corporations, recently made submissions to the White House Office of Management and Budget, or OMB, the department handling the stimulus package. They urged a reversal of the policy. “We all poured most of our energy into submitting our views,” Champney said.
Submissions in hand, the Obama administration will now write the final rules on how to implement Buy American. A spokesman for the OMB said recently the legislation is expected to be tweaked, “but to what extent and how significantly, that remains to be seen.” Read more here.
June 30, 2009
Is ‘Buy China’ a Protectionist Threat?
(New York Times – Catherine Rampell)
“Government investment projects should buy domestically made products unless products or services cannot be obtained in reasonable commercial conditions in China,” a Beijing government edict said.
The Chinese government quibbled with the “protectionist” characterization of its edict – not surprisingly, given how energetically the Communist leadership protested the protectionist portions of the United States’ stimulus package. But economists have fretted about it nonetheless, fearing that it may be a potential harbinger of a new wave of protectionist policies throughout the developing world.
Is this a trend free trade advocates should really worry about? Should we expect other emerging economies to start hoisting up trade barriers, under the impression that the current crisis has somehow debunked capitalism? Read more here.
“Government investment projects should buy domestically made products unless products or services cannot be obtained in reasonable commercial conditions in China,” a Beijing government edict said.
The Chinese government quibbled with the “protectionist” characterization of its edict – not surprisingly, given how energetically the Communist leadership protested the protectionist portions of the United States’ stimulus package. But economists have fretted about it nonetheless, fearing that it may be a potential harbinger of a new wave of protectionist policies throughout the developing world.
Is this a trend free trade advocates should really worry about? Should we expect other emerging economies to start hoisting up trade barriers, under the impression that the current crisis has somehow debunked capitalism? Read more here.
Customs Notice: Canada-EFTA Free Trade Agreement
(CBSA)
The following is now available on the CBSA Web site:
CN09-014 Proposed Regulatory Amendments and Proposed New Regulations Related to the Implementation of the Canada-European Free Trade Association Free Trade Agreement
This notice announces regulatory amendments and new regulations proposed by the Canada Border Services Agency (CBSA) in support of the implementation of the Canada-European Free Trade Association Free Trade Agreement (CEFTA). It is further proposed that these regulatory amendments and new regulations come into force on July 1, 2009, on condition that the Governor in Council make them.
The following is now available on the CBSA Web site:
CN09-014 Proposed Regulatory Amendments and Proposed New Regulations Related to the Implementation of the Canada-European Free Trade Association Free Trade Agreement
This notice announces regulatory amendments and new regulations proposed by the Canada Border Services Agency (CBSA) in support of the implementation of the Canada-European Free Trade Association Free Trade Agreement (CEFTA). It is further proposed that these regulatory amendments and new regulations come into force on July 1, 2009, on condition that the Governor in Council make them.
June 29, 2009
Jordan, Canada Sign Free Trade Agreement
(AP/CTV News)
Canada has inked a free trade pact with Jordan that will lift duties on Canadian exports to the Arab nation.
Trade Minister Stockwell Day and his Jordanian counterpart signed the agreement Sunday in Jordan's capital, Amman.
Canada's forestry, manufacturing and agriculture sectors are expected to benefit from duty-free access.
In return, Canada will give the Mideast country preferential trade conditions, including full exemption from customs duties for Jordanian goods.
The deal is expected to be ratified by both parliaments later this year.
Bilateral trade stood at about $92.2 million in 2008, according to a news release from Canadian government. Read more here.
Canada has inked a free trade pact with Jordan that will lift duties on Canadian exports to the Arab nation.
Trade Minister Stockwell Day and his Jordanian counterpart signed the agreement Sunday in Jordan's capital, Amman.
Canada's forestry, manufacturing and agriculture sectors are expected to benefit from duty-free access.
In return, Canada will give the Mideast country preferential trade conditions, including full exemption from customs duties for Jordanian goods.
The deal is expected to be ratified by both parliaments later this year.
Bilateral trade stood at about $92.2 million in 2008, according to a news release from Canadian government. Read more here.
Global Supply Chain Hit by Uniserve Case
(International Freighting Weekly – Gavin van Marle)
Carriers could find themselves fully liable for goods following delivery errors
The number of supply chain partners vulnerable to the new liability loophole uncovered by IFW last month could be far greater than originally thought, and include carriers of all modes, as well as forwarders and warehouse operators.
UK-based freight operator Uniserve was recently found liable in a High Court ruling for a £375,000 (US$610,000) pallet of mobile phone devices that was stolen from one its warehouses in 2003 after being delivered there in error.
The company’s CEO, Iain Liddell, said that more than just the forwarding sector could be liable for goods accepted in good faith, but delivered in error. “If the error is such that your customer didn’t intend to deal with you at all, then no contract will arise and you are liable for the full cost of the goods if you are at fault for their damage or loss, “ he said.
“An error can be as simple as the principal or his agent delivering the goods to the wrong party, but the party receiving those goods may well have a trading relationship and have every intention of providing a service to the principal or his agent and accept the goods in good faith, totally unaware that an error has been made.”
He outlined some potential ways in which hauliers, shipping lines and airlines could find themselves fully liable as the result of errors that would invalidate a contract: Read more here.
Carriers could find themselves fully liable for goods following delivery errors
The number of supply chain partners vulnerable to the new liability loophole uncovered by IFW last month could be far greater than originally thought, and include carriers of all modes, as well as forwarders and warehouse operators.
UK-based freight operator Uniserve was recently found liable in a High Court ruling for a £375,000 (US$610,000) pallet of mobile phone devices that was stolen from one its warehouses in 2003 after being delivered there in error.
The company’s CEO, Iain Liddell, said that more than just the forwarding sector could be liable for goods accepted in good faith, but delivered in error. “If the error is such that your customer didn’t intend to deal with you at all, then no contract will arise and you are liable for the full cost of the goods if you are at fault for their damage or loss, “ he said.
“An error can be as simple as the principal or his agent delivering the goods to the wrong party, but the party receiving those goods may well have a trading relationship and have every intention of providing a service to the principal or his agent and accept the goods in good faith, totally unaware that an error has been made.”
He outlined some potential ways in which hauliers, shipping lines and airlines could find themselves fully liable as the result of errors that would invalidate a contract: Read more here.
June 26, 2009
Premiers Asked to Commit to Non-Discrimination Pact with U.S.
(The Canadian Press – Julian Beltrame)
The federal government is asking Canada’s premiers to sign a declaration that their provinces won’t discriminate against American suppliers as a carrot to convince the U.S. to drop protectionist measures.
Trade Minister Stockwell Day said in an interview Thursday that federal and provincial officials discussed the issue on Monday and that the premiers have been given a draft procurement agreement that would act as an adjunct to the North American Free Trade Agreement. The draft would tie the provinces to the same rules as the federal government on government-let contracts.
In recent months, Canadian companies have been hurt by Buy America measures passed in Congress that compel states and municipalities receiving billions of federal infrastructure dollars to buy exclusively from domestic suppliers of steel and many manufactured goods. Several Canadian firms have complained they have been shut out of municipal infrastructure contracts.
The issue has the potential to escalate into a low-level trade war because Canadian municipalities have threatened to retaliate in their procurement spending by keeping American suppliers out. Read more here.
The federal government is asking Canada’s premiers to sign a declaration that their provinces won’t discriminate against American suppliers as a carrot to convince the U.S. to drop protectionist measures.
Trade Minister Stockwell Day said in an interview Thursday that federal and provincial officials discussed the issue on Monday and that the premiers have been given a draft procurement agreement that would act as an adjunct to the North American Free Trade Agreement. The draft would tie the provinces to the same rules as the federal government on government-let contracts.
In recent months, Canadian companies have been hurt by Buy America measures passed in Congress that compel states and municipalities receiving billions of federal infrastructure dollars to buy exclusively from domestic suppliers of steel and many manufactured goods. Several Canadian firms have complained they have been shut out of municipal infrastructure contracts.
The issue has the potential to escalate into a low-level trade war because Canadian municipalities have threatened to retaliate in their procurement spending by keeping American suppliers out. Read more here.
Canada Asks for Talks on ‘Buy American’ Issue
(Journal of Commerce Online – Alan M. Field)
Canadian trade officials would like to discuss with U.S. counterparts an agreement that would enable U.S. and Canadian companies to have reciprocal access to local and municipal government procurement contracts.
Canadian Trade Minister Stockwell Day asked U.S. Trade Representative Ron Kirk today to “explore” such a deal, which would permit Canadian suppliers to continue to bid for U.S. local and municipal governments, despite “Buy American” provisions in the current U.S. economic stimulus plan. The two countries already have an agreement governing reciprocal access to government contracts on a federal level.
Although the idea has been widely discussed, this is the first time that the Canadian government has brought the idea directly to the Obama administration. Read more here.
Canadian trade officials would like to discuss with U.S. counterparts an agreement that would enable U.S. and Canadian companies to have reciprocal access to local and municipal government procurement contracts.
Canadian Trade Minister Stockwell Day asked U.S. Trade Representative Ron Kirk today to “explore” such a deal, which would permit Canadian suppliers to continue to bid for U.S. local and municipal governments, despite “Buy American” provisions in the current U.S. economic stimulus plan. The two countries already have an agreement governing reciprocal access to government contracts on a federal level.
Although the idea has been widely discussed, this is the first time that the Canadian government has brought the idea directly to the Obama administration. Read more here.
Minister Day Promotes Canadian Trade in France
(Minister of International Trade)
The Honourable Stockwell Day, Minister of International Trade and Minister for the Asia-Pacific Gateway, today concluded a two-day visit to France where, during important multilateral meetings, he strongly reiterated Canada’s calls to keep markets open and resist the temptation of protectionism.
Minister Day and Ted Menzies, Parliamentary Secretary to the Minister of Finance, met with Organisation for Economic Co-operation and Development (OECD) and World Trade Organization (WTO) partners to address the current state of the world economy and the need for continued trade and investment liberalization.
“In order for us to succeed in restoring prosperity to the global economy, we need to work with OECD and WTO members to fight the impulse to hide behind trade barriers. Canada is leading by example by pursuing free trade agreements with markets all over the globe,” said Minister Day. “We are strongly opposed to protectionism and will continue to defend free and open trade on the world stage.
“The Doha Round of WTO negotiations offers the best way forward to ensure fair, rules-based international trade. We need to aggressively pursue these talks to ensure our Canadian companies gain access to as many markets as possible, especially during this difficult economic period.”
Following the OECD meetings and informal meetings of WTO ministers, Minister Day delivered a speech to senior business officials from the Canada-France Chamber of Commerce where he highlighted Canada’s aggressive free trade agenda, positioned Canada as the best place in the world to do business and called for the need to resist protectionism.
Minister Day also had a very productive meeting with his French counterpart, Anne-Marie Idrac, Secretary of State for Foreign Trade, where he reinforced the need for stronger commercial relations with France and emphasized the importance of concluding negotiations on a comprehensive economic and trade agreement with the European Union as soon as possible.
“An agreement with the European Union, now more than ever, will help provide Canadian companies with enhanced access to the world’s largest market,” said Minister Day. “We will continue to work with our European partners, such as France, to ensure this becomes a reality.”
France is Canada’s eighth-largest merchandise trading partner worldwide and its third-largest in Europe, after the United Kingdom and Germany.
For the complete text of the OECD meeting’s ministerial conclusions is available here (PDF) and more details about Minister Day’s visit can be found here.
The Honourable Stockwell Day, Minister of International Trade and Minister for the Asia-Pacific Gateway, today concluded a two-day visit to France where, during important multilateral meetings, he strongly reiterated Canada’s calls to keep markets open and resist the temptation of protectionism.
Minister Day and Ted Menzies, Parliamentary Secretary to the Minister of Finance, met with Organisation for Economic Co-operation and Development (OECD) and World Trade Organization (WTO) partners to address the current state of the world economy and the need for continued trade and investment liberalization.
“In order for us to succeed in restoring prosperity to the global economy, we need to work with OECD and WTO members to fight the impulse to hide behind trade barriers. Canada is leading by example by pursuing free trade agreements with markets all over the globe,” said Minister Day. “We are strongly opposed to protectionism and will continue to defend free and open trade on the world stage.
“The Doha Round of WTO negotiations offers the best way forward to ensure fair, rules-based international trade. We need to aggressively pursue these talks to ensure our Canadian companies gain access to as many markets as possible, especially during this difficult economic period.”
Following the OECD meetings and informal meetings of WTO ministers, Minister Day delivered a speech to senior business officials from the Canada-France Chamber of Commerce where he highlighted Canada’s aggressive free trade agenda, positioned Canada as the best place in the world to do business and called for the need to resist protectionism.
Minister Day also had a very productive meeting with his French counterpart, Anne-Marie Idrac, Secretary of State for Foreign Trade, where he reinforced the need for stronger commercial relations with France and emphasized the importance of concluding negotiations on a comprehensive economic and trade agreement with the European Union as soon as possible.
“An agreement with the European Union, now more than ever, will help provide Canadian companies with enhanced access to the world’s largest market,” said Minister Day. “We will continue to work with our European partners, such as France, to ensure this becomes a reality.”
France is Canada’s eighth-largest merchandise trading partner worldwide and its third-largest in Europe, after the United Kingdom and Germany.
For the complete text of the OECD meeting’s ministerial conclusions is available here (PDF) and more details about Minister Day’s visit can be found here.
June 25, 2009
Signs of Life in U.S. Economy Bring on a New Uncertainty
(Globe and Mail – Kevin Carmichael)
The world’s largest economy has a pulse.
A series of indicators over the past month is causing forecasters to take a more optimistic view of the prospects for the United States, and, by extension, the country’s many trading partners, including Canada, where stocks rallied yesterday on the possibility of stronger demand south of the border.
The U.S. Federal Reserve’s chief policy makers are the latest to shift their tone, concluding at the end of a two-day meeting yesterday that the “pace of economic contraction is slowing.” Their assessment followed a prediction by the Paris-based Organization for Economic Co-operation and Development that U.S. gross domestic product would expand 0.9% next year, a meagre result, but better than the group’s March prediction that next year would bring no growth.
The emerging consensus that the worst is over for the country that caused the financial crisis is bringing about a new question: What now?
The Fed conceded in its statement that “economic activity is likely to remain weak for a time,” a reality that will force policy makers to remain on guard because hundreds of billions of dollars in public spending is still the biggest source of demand. Read the complete article here.
The world’s largest economy has a pulse.
A series of indicators over the past month is causing forecasters to take a more optimistic view of the prospects for the United States, and, by extension, the country’s many trading partners, including Canada, where stocks rallied yesterday on the possibility of stronger demand south of the border.
The U.S. Federal Reserve’s chief policy makers are the latest to shift their tone, concluding at the end of a two-day meeting yesterday that the “pace of economic contraction is slowing.” Their assessment followed a prediction by the Paris-based Organization for Economic Co-operation and Development that U.S. gross domestic product would expand 0.9% next year, a meagre result, but better than the group’s March prediction that next year would bring no growth.
The emerging consensus that the worst is over for the country that caused the financial crisis is bringing about a new question: What now?
The Fed conceded in its statement that “economic activity is likely to remain weak for a time,” a reality that will force policy makers to remain on guard because hundreds of billions of dollars in public spending is still the biggest source of demand. Read the complete article here.
U.S. Sends Encouraging Trade Signals on Buy America: Flaherty
(CBC News – The Canadian Press)
U.S. congressional leaders appear to be prepared to work with Canada to dampen the threat of protectionism between the world’s two largest trading partners, Finance Minister Jim Flaherty said Wednesday.
Earlier, the finance minister met with several key senators, including former Democratic presidential candidate John Kerry, as well as House budget chairman John Spratt, on the financial crisis and trade issues. “What I heard today was a willingness to work on this issue,” he said in a conference call from Washington. “[And] that Canada is viewed as having a special trading relationship with the United States.”
But Flaherty gave no indication whether the congressmen he met, who were both Republicans and Democrats, were willing to lobby for a repeal of the so-called “Buy America clauses being inserted in billions of dollars of infrastructure spending programs.”
The laws require lower-level governments to use American steel and manufactured goods exclusively in procurement that uses federal infrastructure dollars. The laws do not contravene free trade agreements because the spending is being directed by states and municipalities, not Washington. Read more here.
U.S. congressional leaders appear to be prepared to work with Canada to dampen the threat of protectionism between the world’s two largest trading partners, Finance Minister Jim Flaherty said Wednesday.
Earlier, the finance minister met with several key senators, including former Democratic presidential candidate John Kerry, as well as House budget chairman John Spratt, on the financial crisis and trade issues. “What I heard today was a willingness to work on this issue,” he said in a conference call from Washington. “[And] that Canada is viewed as having a special trading relationship with the United States.”
But Flaherty gave no indication whether the congressmen he met, who were both Republicans and Democrats, were willing to lobby for a repeal of the so-called “Buy America clauses being inserted in billions of dollars of infrastructure spending programs.”
The laws require lower-level governments to use American steel and manufactured goods exclusively in procurement that uses federal infrastructure dollars. The laws do not contravene free trade agreements because the spending is being directed by states and municipalities, not Washington. Read more here.
June 24, 2009
As China Stirs Economy, Some See Protectionism
(New York Times – Keith Bradsher)
China has begun a concerted effort to keep its export economy humming, even as demand for its goods has plummeted with the global downturn.
Risking the ire of the United States and other trading partners, the Chinese government has quietly started adopting policies aimed at encouraging exports while curbing imports, even though China, as one of the world’s largest exporters, has aggressively criticized protectionism in other countries.
The government has sharply expanded three programs to help exporters, giving them larger tax rebates, more generous loans from state-owned banks to finance trade, and more government-paid travel to promote themselves at trade shows around the world.
At the same time, Beijing has banned all local, provincial and national government agencies from buying imported goods except in cases where no local substitute exists. The rule, issued as part of the country’s economic stimulus plan and enforcing a seldom honored Chinese law from 2003 favoring domestic suppliers, exploits China’s failure so far to sign a global agreement barring protectionism in government procurement. Read more here.
China has begun a concerted effort to keep its export economy humming, even as demand for its goods has plummeted with the global downturn.
Risking the ire of the United States and other trading partners, the Chinese government has quietly started adopting policies aimed at encouraging exports while curbing imports, even though China, as one of the world’s largest exporters, has aggressively criticized protectionism in other countries.
The government has sharply expanded three programs to help exporters, giving them larger tax rebates, more generous loans from state-owned banks to finance trade, and more government-paid travel to promote themselves at trade shows around the world.
At the same time, Beijing has banned all local, provincial and national government agencies from buying imported goods except in cases where no local substitute exists. The rule, issued as part of the country’s economic stimulus plan and enforcing a seldom honored Chinese law from 2003 favoring domestic suppliers, exploits China’s failure so far to sign a global agreement barring protectionism in government procurement. Read more here.
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