Obama says U.S. can't send protectionist trade message

WASHINGTON Tue Feb 3, 2009 7:50pm EST

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WASHINGTON (Reuters) - President Barack Obama said on Tuesday he did not want to send a protectionist message on world trade and would look at altering "Buy American" language in an economic stimulus bill coming out of Congress.

"I think it would be a mistake ... at a time when worldwide trade is declining for us to start sending a message that somehow we're just looking after ourselves and not concerned with world trade," Obama said on the Fox television network.

His comments came as the U.S. Senate was debating a nearly $900 billion economic stimulus plan that allows only U.S.-made iron, steel and manufactured goods to be used in public works projects funded by the bill.

That built on a $825 billion stimulus plan passed last week by the House of Representatives that required the use of U.S.-made iron and steel in public works projects. That provision raised concerns among U.S. trading partners that the United States was moving toward increased protectionism.

The governments of both the European Union and Canada sent letters to Congress on Monday urging the provision be dropped.

In a separate interview on the ABC television network, Obama said any parts of the bill that could spark retaliation from U.S. allies should be removed.

"I think we need to make sure that any provisions that are in there are not going to trigger a trade war," he said, referring to the "Buy American" components.

Obama said on Fox he still wanted to have the final bill on his desk ready for signature by the middle of this month.

(Reporting by Jeff Mason and Doug Palmer; editing by Todd Eastham)

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