Trudeau returns with promise

Press, Volume CXII, Issue 33095, 9 December 1972, Page 21

Trudeau returns with promise

(From J

MELVIN SUFRIN,

, N.Z.P.A. special correspondent)

TORONTO, December 7.

Mr Pierre EDiott Trudeau has returned from London with Mij Edward Heath’s promise that Britain will look out for Canadian interests when she joins the European Economic Community on January 1.

While there is no reason to doubt Mr Heath’s good Intentions, Canadians may

perhaps be pardoned if they do not exactly jump for joy. They have heard this sort of promise before only to discover later that it has been sacrificed to self-interest. Mr Heath told the Canadian Prime Minister that Britain would press for freer E.E.C. trade with non-mem-ber countries and, Mr Trudeau said, displayed “justifiable optimism” about chances of success. “We are grateful for this,” Mr Trudeau added. But if Canadians are optimistic—and many are—

about the outlook for continuing healthy sales to the enlarged E.E.C., the reasons are probably more concrete than the rosy predictions emanating from a week-end meeting of the two leaders. As some experts see it, if E.E.C. membership benefits the British economy, it will ultimately benefit Canadian trade.

“What is important is that Britain can be healthier, with more money jingling in her pocket,” says Mr J. R. G. Bleasby, Canadian-based managing director of the Brit-ish-Canadian Trade Association. “Then she will be a better customer instead of a poorer one and want more of our raw materials and finished products.” The same long-range view

is expressed by Mr J, M. McAvity, general manager of the Canadian Exporters’ Association. “Britain has been in relatively shaky condition for a long time. This already has meant she has become progressively less important over the last decade.”

Canada sold SUSI 346 million worth of goods, almost all duty-free, to Britain in 1971. Another SUSIOB6 million went to the E.E.C. While

this makes Europe an important outlet for Canadian products, it is not nearly as important as the United States market which absorbed almost SUS2I,OOO million worth. There is a growing sense of nationalism among Canadians, some of whom feel that dependence on sales to the United States may ultimately interfere with political freedom in this country. But regardless of how liberal the E.E.C. chooses to be, Canada will probably continue to rely on the United States to take more than half its total annual exports. Exporters would nevertheless be unhappy over even a small drop in sales to Europe. They were heartened when Britain was able to negotiate special deals such as dutyfree quotas on 12 so-called “sensitive” items. These included such major Canadian products as plywood, newsprint, phosphorus, wood pulp, lead, zinc and aluminium oxide, all of which are sold in sizeable quantities to Britain. Just how big the duty-free quotas will be is not yet known, of course, but Canadian exporters are hopeful they will be big enough to encompass all sales from Canada for some products. Newsprint is already in short supply in Europe and enters the E.E.C. duty-free. And on plywood, for which quotas must be set before

the end of 1973, there is a ' chance Canada’s position will • actually improve. Plywood now is subject to a 13 per ■ cent tariff and, depending on 1 the size of the duty-free > quotas, Canada might end up ■ selling its plywood both in ; Britain and the Continent without tariffs. The outlook for lead and £ zinc exports is not so bright 1 The special duty-free quotas ■ on both are to be gradually i eliminated.

And prospects for farm products are rather grim. About 96 per cent of Canadian farm exports, including SUS93m worth of wheat sold to Britain, will come under tariffs. Tobacco, cheese, feed barley, wheat, flour, and apples will be affected. And France wants to supplant Canada as primary supplier of wheat to Britain, although there may be some resistance from the British public which has a fondness for the hard variety of Canadian wheat. The average E.E.C. tariff against outside imports now is about 7 per cent. This will apply to all Canadian goods except the “sensitive” items unless new tariff reductions can be negotiated before 1977. At a meeting in Paris earlier this year, leaders of the expanded E.E.C. declared that, to ensure the harmonious development of world trade, the Community should “maintain a constructive dialogue with the United States, Japan, and Canada, and other industrialised commercial partners in an outward-look-ing spirit and using the most appropriate forms.” This has a hopeful sound for countries outside the E.E.C. and looking in. But hard-headed exporters know that a lot of tough negotiating will be needed if Canada is to maintain, let alone increase, sales to a region that now takes 15 per cent of all it sells abroad.