Canadian Manufacturing

Canadian businesses need a clear-cut exemption to Buy American policy: CME

The policy proposes that goods bought by the U.S. federal government must contain 75 per cent U.S. made content by 2029, up from 55 per cent today.

August 3, 2021  by CM Staff

The Canadian Manufacturers & Exporters (CME) association describes itself as “concerned” by details of the U.S. Administration’s Buy American policy.

“They are proposing that goods bought by the U.S. federal government must contain 75 per cent U.S. made content by 2029, up from 55 per cent today,” the Ottawa-based group said in a news release. “[CME] is concerned that this move will hurt Canadian manufacturers that sell to the US Federal Government directly and manufacturers that are part of those procurement supply chains.”

“Even though Administration officials say that Canada is not the target, and that WTO rules will exempt many Canadian manufacturers, past experiences with Buy American shows clearly that Canadian companies always get caught up in such policies,” said CME president and CEO Dennis Darby. “The Buy American chill is real, and without clear-cut exemptions from U.S. officials, that chill on working with Canadian companies will set in again.”

Darby adds: “If there is a risk that dealing with a Canadian supplier will scuttle a government contract, or that there’s too much hassle and paperwork to clear a Canadian supplier, that puts our manufacturers at a clear disadvantage, even if they are competitive on price, service and quality.”

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Of particular concern to manufacturers will be how many Buy American/America provisions will be included in the massive infrastructure bill currently being negotiated in the US Congress, CME said. “Canada does not enjoy WTO protection from state and local level procurement rules. The devil is in the details, and when we are talking about trillions of dollars in infrastructure projects, Canadian manufactures can lose out unfairly,” Darby said.

CME describes a clear-cut exemption, like the one obtained from President Obama in 2008-2009 from their stimulus package, as being the optimal outcome. “We look forward to working with our government and partners again to achieve that end,” it said.