US President Barack Obama was seeking to quell Canadian concerns about US protectionism when he made his first foreign trip as president yesterday to the US’ biggest trading partner and energy supplier.
Obama and Canadian Prime Minister Stephen Harper were scheduled to discuss trade, clean energy technology, the global economic crisis and the war in Afghanistan, officials said, but the US president’s tight schedule on the one-day trip to Ottawa would leave little time for substantive talks.
Trade was set to dominate the discussions and Harper has said he would seek assurances that the “Buy American” clause in the US$787 billion US economic recovery package signed by Obama this week would not discriminate against firms in Canada, which send about 75 percent of their exports to the US.
US officials, in turn, have said Obama would seek to allay those fears. The president said in an interview with the Canadian Broadcasting Corporation this week that Canadians should not be concerned, noting that history showed that “beggar thy neighbor” protectionist policies could backfire.
The “Buy American” provision imposes a requirement that any public works project funded by the stimulus package use only iron, steel and other goods made in the US. While Obama has stressed that the US would comply with its international free trade obligations, Harper said last week he was still concerned about the language in the clause.
Canada is also alarmed by Obama’s stated desire to renegotiate the North American Free-Trade Agreement (NAFTA), to which Canada, the US and Mexico are signatories, fearing that it could lead to new tariff barriers. Obama has said he wants to strengthen environmental and labor provisions.
US administration officials this week sought to downplay the issue, saying that while Obama would raise it in his talks with Harper, the fragile state of the world economy meant he would not be pushing hard for NAFTA to be re-examined now.
Obama foreign policy adviser Denis McDonough said the president would underscore his commitment to boosting trade between the neighbors, which amounts to US$1.5 billion a day, the largest trading partnership in the world.
David Biette, director of the Canada Institute at the Woodrow Wilson International Center for Scholars, said now was not the time for Obama to meddle with NAFTA as it would invite Canada and Mexico to seek changes to the treaty too.
“Why open it up now? It doesn’t make economic sense. Why invite trouble?” Biette said.
“It’s the first step in continuing to rebuild the image of the United States abroad by turning to our closest neighbor,” said John Glenn, director of foreign policy at the German Marshall Fund of the United States, a nonpartisan think tank.
Obama, who wants the US to take the lead in the fight against climate change, was also expected to discuss clean energy technology with Harper, US officials said, while stressing the importance of Canada as a key US energy supplier.
Environmentalists want Obama to press Canada to clean up its “dirty” tar sands in the western province of Alberta, from which oil is extracted in a process that spews out vast amounts of greenhouse gases. In the TV interview, Obama said he wanted to work with Canada on new technologies to capture greenhouse gases, a statement analysts interpreted as recognition that the US cannot afford to adopt a tougher stance against its main energy supplier.