New York State wants adopt its own so-called Buy American. Selling to your government could then become more difficult for hundreds of Quebec businesses.
In recent months, the three political bodies (the Senate, the House of Representatives and the Governor) have each been working on three budgetary provisions so that the State of New York has a policy of local purchasing for contracts over 100. US $ 000.
This would target all foreign companies, including those from Canada and Quebec.
Currently, foreign companies are sometimes subject to clauses in the Buy American in New York State. On the other hand, it concerns those of the federal government (when Washington finances projects), in particular in the construction sector.
The clause of Buy America of the US government (which applies only in public transportation) is also sometimes applied in transit projects.
If adopted, the proposed initiative for the Buy American by the Senate, the House of Representatives and Democratic Governor Andrew M. Cuomo would therefore be in addition to the federal legislation already in force.
Canadian manufacturers are worried
“This is something that worries us,” says Martin Lavoie, director of manufacturing policies at the Canadian Manufacturers and Exporters (GUY).
Generally, a local purchasing policy encourages foreign companies to establish themselves in a country or to transfer part of their production – and jobs there.
According to Martin Lavoie, this type of policy can also limit the growth possibilities of Canadian SMEs. “It becomes problematic if your market is saturated in Quebec and Canada, and you can hardly export to the American market. China is fine, but our main market is the United States! ”He says.
The stakes are high for Quebec, because New York State is by far our number one export market in the United States.
In 2016, our merchandise shipments totaled C $ 6.6 billion, according to theQuebec Institute of Statistics (ISQ). To put things in perspective, this is twice the value of Quebec’s total exports to China (CA $ 3 billion).
In a statement released in January, Governor Cuomo said his proposal would put in place “the most ambitious purchasing policy for products made in the United States developed by an American state.”
Each year, New York State spends billions of dollars to purchase goods and services. However, according to Governor Cuomo, the economic spinoffs in the United States and in his state are insufficient.
“Existing regulations place little importance on this spending power being used to support American manufacturing companies, many of which are located right here in New York State.”
Quebec diplomacy is at the front
Joined by Deals, Quebec’s delegate general in New York, Jean-Claude Lauzon, said he and his team were working hard to try to convince the Senate, the House of Representatives and Governor Cuomo to abandon this proposal.
“Of all my files, this is the one that has the highest priority,” insists the general delegate, who has visited the capital Albany on several occasions to meet with elected officials.
“We try to make them aware that the economies of Quebec and New York State are very intertwined,” he says, specifying that he often gives them the example of Bombardier Transportation.
Thus, equipment is assembled in Plattsburgh (in the state of New York), parts and design are made in La Pocatière (in Quebec) and systems are developed in Pittsburgh (in Pennsylvania, bordering the state of New York).
Jean-Claude Lauzon remains optimistic despite everything. He believes it is still possible to convince the Senate, House of Representatives or Governor Cuomo to back down. And it wouldn’t be the first time.
In 2016, New Jersey also wanted to include a local purchase proposal in its budget. The General Delegation of Quebec in New York however, made sustained representations to the state, and ultimately convinced it to back down. The Canadian government had also made representations.
MECs are also concerned about the trend that seems to be taking hold in the United States since the election of Donald Trump. That the State of New York wants to have a Buy American is one thing.
But if some twenty American states one day adopt their own local purchasing policy, Canadian and Quebec exports will be really at risk in the United States, where Canada sends 76% of its exports (71% in the case of of Quebec).
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