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Minimal economic impact expected from Quebec securing independence.

Minimal economic impact expected from Quebec securing independence

The possibility of Quebec separating from Canada appears to be creating very little concern for the economy of Northern Ontario.

In fact, some people think separation could have positive effects.

Cochrane-Superior MP Reg Belair believes if separation ever did occur, English-speaking investors in Canada might not wish to invest in Quebec. "Northern Ontario may benefit."

Belair noted that Northern Ontario has as many natural resources as Northern Quebec to attract investors and the areas are quite similar in many ways.

Don Allan, manager of the Northeastern Ontario Chambers of Commerce, foresees very little impact from Quebec independence, except from a psychological perspective.

Allan believes independence would mean a loss of investor confidence in Canada, resulting in a less valuable dollar and higher interest rates to prop it up.

"For the north, a lower Canadian dollar would almost be positive in terms of making exports more competitive," he predicted.

K.V. Nagarajan, an assistant professor at Laurentian University's school of commerce and administration, said it appears that Quebec may seek political sovereignty and economic association.

"As far as Northern Ontario goes, it will not have a significant effect."

However, Northern Development Minister Rene Fontaine warned separation would hurt the whole country, even though he said, "People will adjust later on."

Fontaine pointed out that investment interest in the country is already being cooled by talk of separation.

Similar speculation has been taking place all across the country as the June 23 deadline for ratification of the Meech Lake Accord draws closer.

ON THE BORDER

Some companies might face more precarious situations than others, if Quebec leaves confederation.

A Tembec Inc. pulp and paper mill in Temiscaming sits just on the Quebec side of the border. Of the mill's 800 employees, 25 per cent live in Ontario and cross the border each day to work.

However, Tembec Inc. president Frank Dottori is not worried over possible separation. "I don't think it's going to change anything."

The current constitutional debate and consequent talk of independence is not something which affects Tembec on a day-to-day basis, said Dottori.

"We don't have Meech Lake today, so what's the difference if we don't have it after June 23?"

There are already inter-provincial trade barriers covering such things as beer, chickens and workers, Dottori noted. "If Quebec was a separate state, it certainly wouldn't get worse."

The Timmins native believes Canadians have a problem recognizing Quebec as a distinct society, noting that has become a sore point in Quebec.

Nevertheless, he is an opponent of the Meech Lake Accord, warning the opting-out provisions will create 10 independent states. "I think Meech Lake is a disaster for Canada."

And he believes the accord will not solve the confrontation and division that has built up in the country over the years. "I think the damage has been done."

NEW ARRANGEMENT

In fact, Dottori thinks that sometime in the future another arrangement will have to be created, although he believes Quebec will remain part of Canada.

Belair rejects any notion that separation might mean franco-phones in Northern Ontario would leave for Quebec, unless there is a strong English backlash against them.

"The French people in Northern Ontario have been established for the last 70 years," he noted.

The MP said the climate of intolerance of the last few months has been limited to a small group of people, and the English-only resolutions of Sault Ste. Marie and Thunder Bay was partly due to frustration with the provincial government.

However, he said, "Some people will never accept the fact that French is equal to English."

ATLANTIC REGION WOULD LOSE

If Quebec goes completely independent, Nagarajan believes Northern Ontario won't be the most affected part of what would remain of Canada.

"I think Atlantic Canada would have a much more serious problem than Northern Ontario," he said.

Nagarajan explained that most of Northern Ontario's economic links are to southern Ontario, not to Quebec.

VIEW FROM QUEBEC

Jacques Viau, the director of public affairs with Comtar Inc. in Montreal, said possible Quebec independence is highly speculative and hasn't been discussed by the company.

Viau said it is fair to say that most businesses in Quebec are in favor of the Meech Lake Accord.

However, if the agreement is not ratified by the deadline, he said Quebec will have to look at the alternatives, including sovereignty-association or independence.

Domtar, which has the Quebec government as a majority owner, operates a containerboard division in Red Rock and forest products divisions in Red Rock and White River.

Viau noted there are very solid links between Northern Ontario and Northern Quebec and there is natural trading between the two regions.

The economic strength of Quebec is an important consideration in any future decision, Viau explained. "It's becoming a very important factor."

There is a confidence in Quebec that didn't exist in 1980, during the sovereignty-association referendum, he said.

Dividing Canada would be counter to the world-wide trend, he said. "The trend is for countries to unite in trading blocs, rather than divide."

PHOTO : On the line dividing Northern Ontario and Quebec sits a Tembec Inc. pulp and paper

PHOTO : operation. The company president believes there would be very little economic change if

PHOTO : Quebec were to become independent, a view shared by many.

PAUL BICKFORD Staff Writer
COPYRIGHT 1990 Laurentian Business Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Author:Bickford, Paul
Publication:Northern Ontario Business
Date:Jun 1, 1990
Words:888
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