Fed: Aust to check if "Buy American" flouts US-Aust FTA
06 Feb 2009 2:32 AM
Australia will examine its free trade deal with the United States to see if Washington is flouting its obligations under the pact if it adopts a BUY AMERICAN clause for new stimulus projects.
America's key trading partners .. including Australia .. are alarmed at the clause .. which seeks to ban the use of foreign steel and iron in major US infrastructure projects.
Australia stands to lose half a billion dollars in steel exports to the United States .. if Congress adopts the measure as part of Washington's $US819 billion financial stimulus package.
Trade Minister SIMON CREAN has warned protectionism by the US will only prompt retaliation by other countries .. while officials are looking at the free trade deal with the United States .. and whether the US could be breaching its obligations under the agreement.
US President BARACK OBAMA has warned Congress the BUY AMERICAN clause would send a protectionist message to the world .. but the US Senate has rejected an attempt by Republican JOHN MCCAIN to dump the Buy American clause.
