Free Trade

The recent action taken by the Gen- eral Agreement on Tariffs and Trade (GATT) against the west coast fishing industry should sound an alarm on the potential threat to jobs posed by a free trade agreement with the United States.

An estimated 4,000 jobs in the fish processing industry are at stake if a trade ruling, already endorsed by a GATT panel, is ratified by the full council of GATT when it meets in Geneva March 22.

But when the provisions of the free trade deal are also taken into account, much more is at stake than just the fish- ing industry — thousands of jobs in resource processing, present and future, could be in danger.

Three years ago, several American fish processors based in Alaska, filed a com- plaint before GATT, charging that Can- adian government export regulations —which stipulate that sock- eye and pink salmon as well as roe herring must be processed in Canada before export — were in violation of GATT trade rules.

Although the regulations are intended mainly to ensure quality control, they have been responsible for thousands of jobs being retained in Canada by Cana- dian workers. And if the regulations are eliminated, both fishing industry unions and the processing companies warn, salmon and roe herring caught in Can- ada could be sent to the U.S. for process- ing or even to low-wage countries such as Korea and the Philippines.

In a long-delayed decision brought down last year, the GATT panel upheld the Americans’ complaint. Even then,

PROCESSING ROE HERRING ..

jobs could go to

_if the GATT ruling gO the U.S. or offshore.

however, the decision left open the pos- sibility of an agreement being worked out between the U.S. and Canada.

The dispute was later referred to the free trade negotiations for resolution. But despite the fact that Newfoundland Premier Brian Peckford was successful in winning an exemption for the east coast fishing industry, the U.S. refused to give up what it had won at GATT. It has continued to insist that the regulations are in violation of GATT rules and must be scrapped.

Even in the face of the U.S. position, Canada could block the final adoption of the GATT decision by exercising its veto — as it is within its rights to do.

“Canada has a veto ... and it’s time that this country asserted its sovereignty ... and said, no, this is going to cost us too much,” Jack Nichol, president of the United Fishermen and Allied Workers Union declared at a union rally in Van- couver March 4. The UFAWU has waged a coastwide campaign against the GATT ruling and took a lobby to Ottawa in an effort to convince the fed- eral government to prevent the U.S. from using the GATT to threaten thou- sands of jobs in the B.C. fishing indus- try.

But the federal government has declined to use its power to veto the rul- ing. It has argued that to do so would “rock the boat” over the free trade agreement. Government ministers have even suggested that some industries “may have to be sacrificed.”

Initially, the U.S. could have ended the dispute by what is known as the “mirror regulation” solution —

es through these

THE LITTLE TRVCK DRIVER FROM BAIE COMEAY DELIVERS

adopting similar regulations in the U.S. to those currently in effect in Canada. Instead, the U.S. chose to penalize Canada. That should give Canadians a good indication of what they can expect from the U.S. under the free trade agreement.

What is worse, however, is that by signing the agreement, Canada will close the door to two options which are now open: to veto the GATT ruling or to refuse to implement it (as the U.S. has done with several GATT rulings in the past). Under the provisions of the free trade deal, all GATT decisions — which currently are voluntary — would

become binding.

The government’s position that it will not block the GATT ruling poses a dan- gerous precedent that could be repeated over and over again under the free trade deal. And all our resource industries could be affected.

Canada has long depended on special industry regulations, regional develop- ment programs and other forms of government assistance to create jobs and to promote economic development. That is particularly so in the manufacturing industry where government intervention has been necessary to ensure that resour- ces are not always shipped out in their

S4 e Pacific Tribune, Supplement, March 16, 1988

An interview with William Kashtan

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