Economy
Buy America But Not in Canada!
Written by Sandy Williams
December 18, 2014
Canadians are outraged by the “Buy America” rule applied to a ferry terminal overhaul on Canadian soil.
Funding for updating the Prince Rupert Ferry Terminal in British Columbia, leased to the State of Alaska, is coming primarily from the Federal Highway Administration, which requires Buy America rules. In the restrictions published in tendering documents by the Alaska government, only iron and steel from the U.S. may be used in the project construction.
The Canadian ambassador to the U.S., Gary Doer, sent a letter to the governor of Alaska saying the Buy America requirements are unacceptable for construction projects within Canada.
“More broadly, Buy America policies run counter to the economic interests of both the U.S. and Canada, as they deny our companies and communities the clear benefits that arise from our integrated supply chains,” wrote Doer. “In these tough economic times, Canada and Alaska should be working together to make the best use of taxpayer dollars and allow this project to benefit from unfettered access to the North American procurement market.”
Buy America rules can be waived if using U.S. products would increase costs by more than 25 percent, are in limited quantity, or “would be inconsistent to public interest. “ The Alaska Department of Transportation and Public Facilities said a consultation with the U.S. Transportation Department is necessary to determine if such a waiver is appropriate.
The Canadian government is threatening to invoke the rarely used Foreign Extraterritorial Measures Act (FEMA) to block the Buy America rules for the ferry project. The last time FEMA was enacted was in 1992 after the US tried to tighten trade embargo rules on Cuba by imposing penalties on companies and individuals conducting business there.
The Canadian Manufactures and Exporters (CME) have expressed concern over tightening restrictions that bar Canadian firms from bidding on US projects. CME President and CEO Jayson Myers commented on the Prince Rupert project, within Canadian borders, in a November 24 statement.
“It is time for the US to adopt a policy of exemption for Canadian firms under Buy America provisions or for the Canadian government to adopt a reciprocity policy that will level the playing field for Canadian steel manufacturers. Someone has to step up for Canada here,” said Myers. “This type of protectionist policy has no place in a trade relationship as strong as that between Canada and America.”
In the meantime, the opening date for bids has been extended to January 6 to allow time to resolve the Buy America issues.
Sandy Williams
Read more from Sandy WilliamsLatest in Economy
ISM: Manufacturing growth remained down in August
US manufacturing activity remained muted in August despite a marginal gain from July's recent low, according to supply executives contributing to the Institute for Supply Management (ISM)’s latest report.
Steel Summit: Dr. Basu blames tariffs for riskier path ahead
Steel executives packed the main conference hall of the 2025 SMU Steel Summit on Tuesday, Aug. 26, to hear economist Dr. Anirban Basu lay out his blunt view of tariffs, inflation, and demand.
Steel Summit: Schneider sees SDI ‘on the edge of a very good run’
Steel Dynamics Inc. (SDI) President and Chief Operating Officer, Barry Schneider, remains bullish about the Fort Wayne, Ind.-based steelmaker’s position in the current market.
US housing starts gain momentum in July
US housing starts rose in July both month-on-month and year-on-year, according to figures from the US Census Bureau.
Manufacturing in New York state improves again in August
Business activity in New York state improved modestly in August. It was just the second positive reading for the general business conditions index in six months.