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February 16, 2009

CANADA: Continued vigilance needed against US protectionism -- Day

Canadian Press

OTTAWA — The Buy American provisions of the U.S. economic stimulus package will require "ongoing vigilance" to ensure they don't adversely affect Canadian interests, says Canadian Trade Minister Stockwell Day.

Speaking Sunday on CTV's "Question Period," Day said the Conservative government is still concerned about the provisions, despite amendments that may have softened their impact as the plan made its way through Congress.

"Now it's going to be a matter of monitoring it carefully," said the minister.

He expressed satisfaction that President Barack Obama pressed for legislative changes to specify the economic plan must conform to U.S. obligations under the North American Free Trade Agreement and the rules of the World Trade Organization.

That means, for example, that the Buy American requirement for steel products could be waived for U.S. infrastructure projects. But Ottawa will keep a close eye on developments to see what happens in practice.

"The political will is going to have to be there for them (the Obama administration) to enforce that exemption that allows our products and our services, as long as they're competitive, to go into some of these U.S. infrastructure projects."

Canada, the European Union and other American trade partners have voiced concerns that the measures could portend a move toward protectionism as the Americans grapple with the current economic crisis.

Day said he's sure Prime Minister Stephen Harper will be "sharing some of those things with the president" when Obama visits Ottawa this week.

He also served notice that Ottawa will be alert for any protectionist initiatives to safeguard U.S. jobs at the expense of Canadian workers in any aid package for auto manufacturers.

"The industry is highly integrated and we want to make sure it stays that way," he said.

Day noted as well that the government is paying close attention to a review of border security ordered by Janet Napolitano, the new U.S. homeland security secretary.

The Tories want to send a message that the smooth flow of trade at land border points can't be throttled in the name of fighting terrorism.

"We're going to be aggressive on this front," said Day, a former public safety minister.

"We take security very seriously, but we don't want efficiency at the border being trumped by security. We think there's a balance there that can be achieved."

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