BUSINESS/SPECIAL REPORT

Paradise postponed

December 3 1990
BUSINESS/SPECIAL REPORT

Paradise postponed

December 3 1990

Paradise postponed

Canadian business leaders were among the strongest supporters of the Canada-U.S. Free Trade Agreement before it was signed two years ago. Now, some say that the agreement’s benefits are hard to quantify. Their comments:

PETER LOUGHEED, Calgary lawyer and former Alberta premier: “There is no question in my mind that the positive benefits of the FTA that we envisioned will, over time, be realized. One result was the U.S. approval last month to export Canadian natural gas by pipeline from Alberta to New England. But I am disappointed that the FTA’s benefits are being diluted by a high-interest-rate monetary policy. The Bank of Canada has made a grave error in judgment.”

SONJA BATA, director, Bata Ltd., Toronto: “The FTA has shown us where our weaknesses are. In retailing, we see more American competition coming in, such as the Gap clothing-store chain. And suddenly I am noticing that L. L. Bean and other U.S. mail-order catalogues are appearing in our junk mail. In the catalogues, the prices are low. We cannot stop people from buying, or stop cross-border shopping. But so far, few Canadian retailers have branched out into the United States.”

^ËÊËÊÉ^ JOHN RISLEY, president, Clearwater Fine Foods Inc., Halifax: “There is disappointment in the fishing industry with how S intangible the benefits of the agreement are, but I am still a vocal ^ supporter. The first dispute-settlement decisions were fisheries

A W matters, and were reasonably good in terms of principles. But I — / wish that politicians would heed the panels’ decisions instead of trying to circumnavigate them. Unless the country’s health is threatened, they should abide by the process.”

ALFRED POWIS, chairman, Noranda Inc., Toronto: “I am more convinced than ever that the FTA was the right way to go. Things are tough now, but for reasons that have nothing to do with the FTA. One thing that it has done is discourage American industry from launching frivolous trade complaints. In the 10 years preceding the FTA, we were fighting dumping or countervail actions all the time on things like softwood lumber or potash. We have not had any since the FTA went into effect.”

ROBERT BLAIR, chairman, Nova Corp., Calgary: “U.S. tariffs on materials like Canadian methanol had climbed up to 20 per cent [before the FTA]. Wè calculated that Nova would save $30 million to $60 million a year if the duties were eliminated, and we are more than halfway there now. But the high Canadian dollar has really jammed exporters, including us. Our annual profits are down by about $150 million—a rough ride, but we are still on this bronco and we are not going to get off.”

JAMES PATTI SON, chairman, the Jim Pattison Group, Vancouver: “Long-term, the FTA was the right decision. There are going to be dislocations in businesses that can’t make it. But it’s like castor oil—you have to get it over with. The Canada-U.S. border is an imaginary border. And free trade with Mexico is coming. We’ve just done a study that determined that we can manufacture in Mexico and ship to Vancouver, including duty and freight, cheaper than we can manufacture in Vancouver.”