Does the "Buy American Products" logo spark a trade war

The new US president prefers tightening American procurement rules and wants to use the federal government's purchasing power instead of a trade war, but new measures he has launched are starting to displease Washington's strategic partners.

New U.S. President Joe Biden is signing Monday a decree giving priority to American companies and products in deals with federal agencies, reclaiming his predecessor Donald Trump's favorite slogan, "Made in America."

The 1933 Act forces the Government to enter into contracts with American companies when possible, but there are many exceptions, which small and medium-sized companies have been criticizing for some time.

Some goods have the slogan "Manufactured in the United States," although much of their composition is of other origin.

Senior White House officials said that the text was aimed at relaunching national production, preserving industrial jobs and increasing "investments in the manufacturing and labour sectors with a view to better upgrading."

Less than a week after assuming office, Biden continues to move to pursue his priorities through presidential decrees, while his Government team has not yet assumed its functions.

The new measures may cause displeasure among Washington's strategic allies and partners, such as Canada and European countries, which considered the "Buy American Products" slogan to prevent their institutions from accessing the US Government's solicitation.

Mark Garnow told CBC that "it is clear that if we notice that the policy of buying American products, which is harmful to our trade, we will let them know," noting that "President Biden has informed us that he is willing to listen to us every time we are concerned."

If Lloyd Austin was the Minister of Defence in office Friday before the Senate, key ministries such as Foreign Affairs are still waiting for ministers to be confirmed in office.

The Senate will vote to install Janet Yellen as Treasury Secretary, who is supposed to oversee economic projects, including a $1900 billion bailout plan to get the country out of the crisis.

The new decree would reduce the likelihood of circumventing the rules requiring the federal administration to prioritize its procurement of manufactured products in the United States.

The aim is also to induce federal agencies to fill the legal loopholes exploited by companies that manufacture only a small portion of the products offered to the Government in the United States.

This decision is reminiscent of the decisions of his predecessors, particularly Donald Trump, who, through the Federal State Decree, urged the purchase of more American products and made the imposition of customs duties as a weapon against imports, have had mixed results.

Instead of a trade war, Joe Biden prefers tightening American product procurement rules and wants to use the federal government's purchasing power.

An American administration official said that "the dollars spent by the federal government are a powerful tool to support American workers and manufacturers. Public procurement alone represents approximately $600 billion in federal spending. "

According to the administration, the American Product Purchase Act of 1933, which is still in force, requires federal agencies to provide as a priority products manufactured on American soil "but preferences have not always been implemented harmoniously or effectively."

It is expected that Biden's approach will lead to "a fundamental change in the structure of American product procurement procedures" with a view to changing the very definition of a product considered to be manufactured in the United States and increasing the likelihood of exemptions.

The Department also wants new firms, including small ones, to have access to solicitation processes.

During the election campaign, Joe Biden promised to tighten the "Buy American Products" Act with a $400 billion plan for projects using products manufactured in the United States, in particular steel or protective equipment for health workers struggling with the Covid-19 epidemic.

After his victory, he confirmed that the federal government would buy American cars and stocks, but companies warned that adopting highly binding rules would lead to higher costs that would complicate the purchase of spare parts manufactured outside the United States.

One of Biden's assistants said that the decree should "also be seen as only part of the overall commitment of this Department, to strengthen supply chains."

Washington stresses the shortage caused by the Cofid-19 epidemic, which has shown the weakness of the system, and says it wants to avoid finding itself in a situation where "we rely on States that do not share our interests in the delivery of essential materials."

The new US President remains "determined to work with partners and allies to modernize the rules of world trade so that all countries can use the money paid by taxpayers to encourage investment in their own countries," his assistant adds, a blurred way to criticize China, which is flooding the world with its products.