David MacNaughton, Canada’s ambassador to the United States, sent a letter on March 16, 2017, to four U.S. Democratic lawmakers who support a strong “Buy America” policy, warning of the dangers this type of protectionism would have on trade between the two countries.
The four U.S. legislators, Tammy Baldwin (D-Wis.), Jeff Merkley (D-Ore.), Chris Murphy (D-Conn.) and Jon Tester (D-Mont.), have publically pressed President Donald Trump to make good on his “Buy America” trade policy pledge, saying that the United States has opened its doors wider to foreign companies than other countries have for U.S. firms.
Baldwin and Merkley stated in a joint letter to the president that “our government allows foreign firms more opportunities to bid on U.S. taxpayer-financed procurement than American firms receive in return from trade partner countries,” citing a new report from the Government Accountability Office. They asked that the Trump Administration suspend Buy American waivers for foreign companies until the government procurement sections of U.S. trade agreements, such as the North America Free Trade Agreement, are renegotiated.
In response, MacNaughton wrote the senators saying, “Imposing local content requirements on the purchasing decisions of private companies is unprecedented and would have potentially severe and wide-ranging consequences, including vis-a-vis international trade obligations.” The letter goes on to say, “These are crucial principles that Canada and the United States have together championed for decades.”
His letter underscored the fact that Canadian suppliers account for just 0.15 percent of U.S. federal contracts, while American suppliers account for some 9 percent of federal contracts in Canada, according to the Toronto Star. The letter also stated that protectionism drives up prices, which leads to fewer projects and jobs.
MacNaughton took up his post as ambassador in March 2016, and with a new administration will be tasked with issues such as NAFTA renegotiations. As reported in the Miami Herald, he says that Canada has to do “a better job of convincing and demonstrating to Americans that their prosperity is very much dependent on continued trade, investment and tourism with Canada.”