There have been quite a few news articles in the past several days about Canadian concerns that Canadian companies are shut out of many U.S. state and local government procurement conracts, but U.S. companies have access to similar Canadian contracts. Some have suggested keeping U.S. companies out of these Canadian contracts as retaliation, although others disagree, some preferring a push for new trade liberalization in this area.
The point made by the Canadians seems to be, we give you access to our local procurement contracts, so you should give us access to yours. Not an unreasonable view, although which of the two appropriate responses is best can be debated.
Today, a spokesperson for USTR addressed the issue as follows (via Reuters):
Canadian suppliers currently have few rights in U.S. state and local government procurement, but the U.S. Trade Representative is willing to discuss a reciprocal deal, a USTR spokeswoman said on Wednesday. Responding to concerns about the "Buy American" provisions of the U.S. economic stimulus package, Debbie Mesloh noted the U.S. government requires "reciprocity" for rights to U.S. procurement opportunities.
"USTR is always willing to sit down with our trading partners to discuss access to our procurement market when they are ready to enter agreements with specific commitments to provide reciprocal opportunities for U.S. goods, services, and suppliers," Mesloh said in an email response to questions. ... "While the United States covers 40 states in various (trade) agreements, none of those commitments extend to Canada since it has never offered its provinces under the NAFTA or the WTO" government procurement agreement, Mesloh said.
"As a consequence, Canadian suppliers have few rights to sub-central procurement in the United States," she said. What's interesting about this response is that it focuses on commitments rather than access. In a sense, the USTR position is, you haven't committed to opening your markets, so we're not going to open ours. Commitments are important, or course. However, liberalization that goes beyond commitments is significant as well. In terms of empirical data, I'm not sure which market is more open in relation to access to local government procurement. But if it is true that the Canadian one is more open, as they seem to think, they may have a legitimate gripe here (but, unfortunately, not much in the way of legal recourse).
