A Pacific-region trade agreement may double government contract opportunities for businesses based in 11 foreign countries, while doing little to help U.S. companies abroad, according to a Washington-based consumer advocacy group.
The Trans-Pacific Partnership being negotiated by Australia, Japan, the U.S., Vietnam, Mexico and seven other countries would treat businesses based in any participating nation as a domestic company when vying for government work.
It’s a bad deal for American companies because the U.S. government market is about twice as large as the other 11 countries’ combined procurement spending, according to research from Public Citizen’s Global Trade Watch. The analysis was published today by EconoBytes, an economic study roundup compiled by Fenton Communications.
“It is a ridiculous notion that new access for some U.S. companies to bid on contracts” in the 11 other nations “is a good trade-off for waiving Buy American preferences on U.S. procurement,” the review said.
So-called Buy American preferences require U.S. agencies to purchase goods produced inside the country, unless items are unavailable from a domestic manufacturer or unreasonably more expensive. The 1933 law was designed to help stimulate economic growth and domestic employment in the U.S.
There are 12 nations — the U.S., Vietnam, Japan, Chile, Canada, Mexico, Peru, Singapore, New Zealand, Australia, Brunei and Malaysia — working toward the Trans-Pacific Partnership accord. They seek an agreement by the end of the year.