The economic rescue package, worth 800 billion US dollars, contains a clause which stipulates that American investors should use only US-made iron, steel and manufactured goods in projects funded by the package. A clear case of protectionism, the EU and Canada say.

President Barack ObamaThe EU and Canada have already called upon the World Trade Organisation (WTO) to take action against this so-called "Buy American" clause in the package. Protectionism is not in line with the rules set by the WTO, of which the USA is a high profile member.

Disappointment
The EU has already expressed its disappointment with the clause, afraid that it might affect European exports to the US. The European Parliamentary Committee for International Trade (INTA) issued a statement on Monday, urging President Obama to withdraw the clause.

Vice-chairwoman of the INTA is Dutch MEP Corien Wortman of the conservative EPP-ED group in the European Parliament. She hopes the WTO will summon the US to change its mind:

"This is not according to international rules of the game. If [the Americans] do go ahead with it, I'm really afraid that we will get a kind of protectionism not only in America, but that it will also feed protectionism in Europe, China and Africa as well. We should keep the Americans to their obligations in the WTO framework".

But doing so may prove to be very difficult, as the "Buy American" clause is part of the highly anticipated 800 billion dollar rescue package, which seeks to steer the American economy away from more doom and gloom. If the package is halted, observers warn that it would have major effects on economies worldwide, including that of the EU.

Promises
Also, President Obama drew a lot of support from US trade unions during his election campaign, in which he  voiced his ambition to protect American industries.

It would be difficult for the new president not to honour these promises.

Honeymoon
The package is being discussed in the US Senate this week. No matter what the outcome may be, or the possible steps taken by the WTO, this conflict between the EU and the US might already signal the end of President Obama's 'honeymoon' with the rest of the world.

Johan van Slooten
Radio Netherlands