♠ Posted by Emmanuel in Credit Crisis,Trade
at 1/29/2009 07:07:00 AM
It is with great pleasure that I announce that blogging buddy Ben Muse is back in action after a short lapse. He notes that "Buy American" clauses in the forthcoming US stimulus package are subject to WTO contestation, to no one's real surprise. Here's the relevant quote from the trade lobbies concerning violations of agreements on government procurement:Violate the United States’ international commitments, depending upon the actual proposal. The United States, through its membership in the World Trade Organization Government Procurement Agreement (GPA) and several bilateral and regional trade agreements, has guaranteed non-discriminatory access to the procurement markets of many of our largest trading partners. In return, the United States has agreed to provide non-discriminatory access to our own procurement markets for projects above certain dollar thresholds. The U.S. approach, crafted over successive Democratic and Republican Administrations, preserves many safeguards in our procurement rules for American goods and firms, including Buy American provisions for some projects, as well as small-business preferences. If the United States expands or enacts new Buy American-type provisions that abrogate U.S. GPA or our other trade agreement commitments, the United States and U.S. firms will face retaliatory sanctions in other markets and jeopardize our ability to open other foreign government procurement markets to U.S. goods and services.It's well and truly raining protectionists now.
UPDATE 1: More on this point from Agence France-Presse (the irony here should be obvious).
UPDATE 2/4: Kevil Hall of McClatchy has a good backgrounder on the subject matter.
