The possibility of the Canada-EU Comprehensive Economic Trade Agreement (CETA) will include subnational procurement clauses raises the prospect of European companies having protected access to procurement processes in Canadian municipalities in spite of any policy desire to buy locally and that, Nenshi said in an interview Wednesday, could pose a problem.
“We’re pretty nervous about the CETA deal, and have been from the beginning,” he told iPolitics Wednesday morning. “We don’t do this much in Calgary, but other cities find it important to give preferential treatment to small business, for example, or maybe minority-owned business or locally owned business. And people are quite nervous that by opening up municipal procurement to every single company in the European Union, it will be difficult for small businesses and local businesses to thrive.”
European access would only be protected for contracts above a certain threshold, believed to be $8.5 million for construction projects and $340,000 for goods and services. But the figures are not yet public. Adding to Nenshi’s concerns, he said, is the fact that nobody has seen the text of the trade agreement yet.
“The federal government has been continually reassuring municipalities that the principles that we need are being reflected in the trade agreement, but of course, no one has seen the agreement, so we’re actually quite nervous about it,” he said. “Procurement is one of the few tools that cities have to look at economic development.”
Nenshi said that though the federal trade minister, Ed Fast, has spoken to the Federation of Canadian Municipalities (FCM), “the poor guy has made the same speech three years in a row,” simply repeating that the interests of municipalities will be protected. However, even if they are not, there is little recourse available for cities, Nenshi said.
“If the deal is made and it’s bad for cities, there’s not much we can do if the federal government signs off on it,” he said. “The federal government has committed to listening to what the cities have to say, and incorporating our concerns, so we really have to hold them at face value on that and have faith in them.”
The government has tried to downplay concerns about subnational procurement, stating that a Canada-EU trade agreement would “not prevent governments from addressing the needs of their constituents and providing support to local businesses through grants, loans and fiscal incentives.”
The government has also noted that “Canada’s procurement system is already quite open at all levels of government,” and that “when foreign suppliers win bids, they usually source and hire locally.”
In March, after his speech to the FCM conference in Vancouver, the Federation praised Fast’s handling of the file.
“While representing Canada in trade negotiations with the European Union, the Minister has worked tirelessly here at home to address the questions, concerns, and priorities of communities,” the FCM said in a statement. “We applaud his commitment to protect local government interests in any final Canada-EU trade deal.”
When the federal government released its budget in March, the FCM was also roundly positive about the investments the Conservatives put forward, primarily for the indexing of the Gas Tax Fund, which will add $9 billion over $20 years. Nenshi agrees that move – along with a small commitment to a housing strategy – was a good one, but maintains there is still more to do, particularly on water, transit, and further commitments to affordable housing.
He also still maintains Canada ought to have a national transportation strategy, which, he said, would help establish a long-term commitment for “predictable, stable and long-term funding for transit.” Without those three criteria, he said, it’s “impossible for us to do big plans, especially for rail projects in big cities, which are very, very expensive.”
Nenshi was in Ottawa Wednesday to deliver a speech to the Canadian Club of Ottawa on urban planning and building more livable neighbourhoods, along with the importance of municipal infrastructure.
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