It’s fair to say most municipalities are supportive of federal government efforts to work out Canadian exemptions on “Buy America” requirements in U.S. recovery and stimulus legislation. But it’s also fair to say that Canada’s cities have been left out of federal-provincial discussions on the matter so far. This is odd considering the Harper government’s preferred solution — an adjunct to NAFTA that would bind municipal procurement to international trade rules — would have such sweeping impacts on municipal autonomy and the policy space our cities need to navigate the current economic downturn.
While the Association of Municipalities of Ontario has a memorandum of understanding with the provincial government requiring consultation on all international or inter-provincial trade agreements that will affect their jurisdiction, apparently Ontario’s cities have been left out of the loop on International Trade Minister Stockwell Day’s proposal to the provinces on sub-national procurement.
So on June 26, the AMO board passed the following resolution asking that the Ontario government work with cities to find a mutually beneficial solution to the “Buy America” controversy:
WHEREAS the Ontario economy is open and, by its structure, is deeply integrated with the economy of the United States of America; and
WHEREAS the Canada-U.S.A Free Trade Agreement (FTA) and the North American Free Trade Agreement (NAFTA) have guaranteed access of Canadian and Ontario companies to markets in the U.S.; and
WHEREAS Ontario municipalities through their compliance with the Agreement on Internal Trade have open access procurement policies already in place; and
WHEREAS recent legislation in the United States has included measures to ensure that inputs in infrastructure and other projects funded by U.S. stimulus funding was limited to U.S. products and companies; and
WHEREAS this legislation has distributed funding to U.S. state and municipal governments that are not party to the free trade rules of the FTA and NAFTA and are able to exercise “Buy American” procurement policies on U.S. federal monies that should be governed by free trade rules; and
WHEREAS Canadian municipalities, through their advocacy at the national and local levels, have shown strong leadership in the commitment to free trade; and
WHEREAS the Ontario and Canadian governments have proposed including sub-national governments in the FTA and NAFTA as a way to ensure open access to U.S. state and municipal procurements;
THEREFORE BE IT RESOLVED THAT the Board of Directors of the Association of Municipalities calls on the Government of Canada to continue to engage the United States Congress, states, municipalities and other groups in a discussion of the integrated and mutually dependent nature of the North American economy; and
FURTHER BE IT RESOLVED THAT the Board of Directors of the Association of Municipalities of Ontario call on the governments of Ontario and Canada to work with Ontario municipalities through AMO to find mutually beneficial solutions to the growing protectionism in the U.S.A.
Rumour is Minister Day will be making an announcement on Monday, July 6 regarding ongoing consultations with the provinces. Canada’s cities should reject any new proposal for negotiations with the United States on sub-national procurement that would bind them to international rules. There is no evidence such a deal would boost community development, create jobs or secure more contracts in the U.S. for Canadian companies. It will, on the other hand, further limit what our cities can legitimately do to manage their local economies.