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.