Canadian manufacturers predict ‘tough sledding’ following Buy American order
CME leader says Biden’s new rules will encourage Canadian companies to expand south of border.
CALGARY – The head of the Canadian Manufacturers and Exporters says he expects “tough sledding” ahead for his members after U.S. President Joe Biden ordered more stringent Buy American rules for government spending.
President and CEO Dennis Darby says the order affects any project that involves federal spending or jurisdiction and it could therefore limit the ability of Canadians to bid on billions of dollars of contracts involving everything from transit systems to municipal sewer work.
He says it will make it more attractive for a Canadian company interested in expanding to do so in the United States so that its products and services are considered American, especially if the government is expected to be a major client.
Darby says Canada and the United States have highly integrated supply chains, which can be disrupted by such protectionist trade policies. He is calling on Ottawa to continue to press for the U.S. to adopt more of a “Buy North America” position on government procurement.
“Canada is not the bad actor who would perhaps be dumping products through unfair trade practices,” Darby said. “It’s a tough beginning as you know but I think it’s incumbent upon (industry) and on the government to make that case to the U.S.”
Biden’s order would modify the rules for the existing Buy American program, making it harder for contractors to qualify for a waiver and sell foreign-made goods to federal agencies.
It also changes rules so that more of a manufactured good’s components must originate from U.S. factories. American-made goods would also be protected by an increase in the government’s threshold and price preferences, the difference in price over which the government can buy a foreign product.