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Enhancing Opportunity
CME Calls for a Competitive Policy in Canada for Public Infrastructure Investments
OTTAWA - A policy paper released today by Canadian Manufacturers & Exporters (CME) is calling for the leveraging of public investments in transportation equipment and infrastructure in Canada to enhance business opportunities for Canadian industry, create a globally competitive business environment in Canada, attract foreign investment to Canada, and generate the greatest possible economic benefits for Canadians.
With governments at all levels planning to invest heavily in developing
and upgrading infrastructure projects, CME believes that governments must
foster economic development in Canada, in line with what Canada's economic
partners are doing domestically to support their industry, in particular the
United States, Mexico and the European Union.
"By leveraging these investments, governments in Canada would level the
playing field to international standards for transportation equipment and
infrastructure manufacturers in Canada, reduce business uncertainty by forcing
clear, full and open competition for all contracts, and help government
effectively address the legal and political controversy surrounding
sole-source contracting", says CME President Jayson Myers. "Canadian
governments need to catch up and follow the lead of our main trading partners
in that regard. This responsibility should be shared by all levels of
government in a joint commitment".
The federal government announced in its last budget that it will invest
$33 billion in infrastructure over 7 years, a significant proportion of which
is directed to roads and highways, public transit and bridges. Provinces and
municipalities have also announced significant investments in transportation
infrastructure and mass transit over the coming decade. Renewing Canada's
infrastructure is a major opportunity to invest in country's future.
CME's paper describes the domestic content policies that Canada's main
trading partners use to leverage their investments in transportation and mass
transit infrastructure. In the United States, Buy America rules require that
final assembly and 60 % of components be made in the country, while in other
countries similar policies ensure that public investments in infrastructure
generates local economic activity.
Such policies do not exist in Canada. When the federal government funds
infrastructure or transportation projects, this funding is not dependent on
conditions that ensure minimum local economic benefits. In some instances,
provinces and municipalities have asked for levels of Canadian content in mass
transit projects, as has been the case recently in Toronto and Montreal.
However, this would have limited impact on long-term investment attraction and
economic activity as it is done on a base-by-case basis with relatively low
Canadian content levels. This causes uncertainty and has done little to
improve competition and the domestic business environment for transit and
infrastructure suppliers in Canada.
As the case of Canada's trading partners attests and as CME's paper makes
the case, such policies can be implemented while respecting international
trade rules as set in NAFTA and the WTO's Agreement on Government Procurement.
Local content policies exist in most jurisdictions, including NAFTA partners,
the United States and Mexico, as well as the European Union, Japan and China.
As a result, global players have expanded globally by setting up production
facilities in countries in which they wish to have market access.
A motion supported by CME and asking the Canadian government to mandate
Canadian content levels for public transportation projects introduced by Ken
Boshcoff, MP for Thunder Bay - Rainy River, will be debated in the House of
Commons on February 14.
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