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The Facts about Government Procurement and TPP: TPP Promotes Buying American Across the Globe

07/30/2014 - 4:00pm

The Obama Administration is committed to creating jobs, strengthening domestic manufacturing, and promoting sustainable economic growth that benefits American families. That is why USTR is pursuing trade negotiations that contribute to those goals by unlocking new economic opportunities for American workers, businesses, farmers, and ranchers.

The United States is currently participating in the Trans-Pacific Partnership Agreement (TPP) negotiations with 11 growing Asia-Pacific countries. TPP is designed to help create opportunity for Americans by opening these markets to U.S. goods and services, setting high-standard trade rules, and addressing 21st century issues in the global economy. 

There are a lot of myths suggesting that TPP would overturn or undermine our ability to buy American or even prevent states and local governments from implementing their own procurement processes.  These assertions are incorrect.

There is nothing in TPP that will ban federal, state, or local governments from buying American.  In fact, under TPP we are working to ensure that more countries around the world have the ability to buy American in order to help support jobs here at home. TPP will tear down barriers in other countries to create opportunities for our workers in fast-growing markets where governments are significant buyers of goods and services. 

Here are some important facts you should know regarding TPP and government procurement:

 1. TPP will make NO CHANGES to our procurement laws on the federal, state, or local level or undermine existing requirements. 
  • TPP’s rules on non-discrimination in government procurement are not new – they reflect 35 years of laws passed by the U.S. Congress and already govern our relations with more than 50 countries. 
  • Since 1979, under U.S. leadership, the United States and nearly all other industrialized countries, including 8 of the 11 countries that will be TPP partners, have agreed to government procurement rules to ensure a level playing field – a level playing field that benefits the United States. 
  • TPP will do nothing to prevent tax dollars from being used on procurement projects at any level of government right here at home.
  • Nothing in TPP will restrict the ability of governments to make purchases in accordance with their environmental policies.

 

2. TPP will only cover a part of federal procurement and does not cover state or local procurement. 
  • TPP will ensure that our small and minority business preference programs, as well as programs for distressed areas, transportation services, food assistance, and farm support are maintained.
  • TPP will make no changes to existing restrictions, including those on Department of Defense procurement and federal assistance to state and local transportation projects. 

 

3. TPP will not cover state or local government procurement.
  • Nothing in TPP will in any way impact how state and local governments implement their own procurement policies.  No state, local, county, or municipal government is covered by TPP.
  • TPP will not restrict the ability of states to make purchases in accordance with their environmental policies.

 

4. TPP will support job creation not only by helping Americans buy American, but by unlocking new opportunities around the world to sell American.
  • TPP will support American jobs and innovation by opening up new markets for American products in growing economies across the globe.  TPP countries are fast-growing markets where governments are expanding their buying and building as they grow more prosperous. 
  • When TPP is enacted, eight of our TPP partners will already be party to government procurement agreements with the United States.  TPP will open three additional markets to American products.  TPP will also promote rule of law and good governance by promoting fair and transparent purchasing rules, like those we already have in the U.S. 
  • TPP will support U.S. exports in products that we specialize in and foreign governments need, like American-made machinery; and medical, infrastructure, transportation, and IT equipment, and U.S. services.  These are exports that support family-wage middle class jobs across the U.S.

 

5. Of course the U.S. market is larger than those of other countries.  We have the largest economy in the world. 

  • TPP’s market access opportunities for the United States go beyond government procurement.  They cover virtually every good or service that the United States can export.  Because the United States has the largest economy in the world, our market is, by definition, larger than anyone else’s market.  But because we are already the most open economy in the world with the most competitive businesses and workers, we also stand to gain significantly from new opportunities.