OTTAWA -- Prime Minister Jean Chrétien's plan to drop all Canadian trade restrictions for the world's poorest countries will cost jobs and profits in the textile and apparel industry in Canada, government documents show.
The industry is already gearing up to fight the proposal, despite Mr. Chrétien's determination to have a market-access plan to present to the Group of Eight summit in June.
"If imports [from the world's least developed countries] continue to increase, it is possible that jobs may be lost in some manufacturing segments," says a draft of a government discussion paper on the plan to be released next week, but obtained by The Globe and Mail.
However, the paper adds that the job loss could be offset by export-oriented segments of the industry.
For the textile and apparel industry, however, this analysis is too simplistic. Last year, impoverished countries increased their sales to Canada 9 per cent from a year earlier, while Canadian exports dropped 8 per cent, said Basil Toutoungi, chairman of the Canadian Textiles Institute and president of Montreal-based Cavalier Textiles Inc. The end of quotas and tariffs will continue that trend, he said.
"We're already giving our jobs away, and we don't understand why," he said. "We're not happy about it. It doesn't make sense."
People who are being paid between $13 and $14 an hour in the apparel industry in Quebec will be replaced by workers who earn $1 a day and labour under terrible conditions in developing countries, he said.
The textile and apparel industry employs 150,000 people in Canada, with the apparel sector based in Quebec and the textile sector spread out mainly between Ontario and Quebec.
The industry will be lobbying against the measures, and targeting International Trade Minister Pierre Pettigrew, who is leading government consultations on the plan and has a large number of textile and apparel interests in his Montreal riding, Mr. Toutoungi said.
For years, the Canadian and U.S. governments have been under intense pressure to eliminate all textile and agricultural duties and quotas facing imports from the world's poorest countries, most of which are in Africa. Canada has staunchly defended the protections in previous trade negotiations, in order to keep jobs and companies in Canada.
Now, as Mr. Chrétien is about to host the G8 summit in Alberta and focus on a new initiative to help Africa out of poverty, the government wants to show its commitment to the poor, officials said yesterday.
"The Prime Minister wants to do something for Africa, and he seems to be determined to do it," said trade consultant Peter Clark. "But the Prime Minister is not going to do something like this lightly, because Quebec is right in the middle of this."
Mr. Pettigrew said he is starting cross-country consultations on how to proceed. But the draft paper makes it clear Ottawa intends to eliminate tariffs and quotas for 48 of the world's poorest countries, and textiles and apparel will be the main target. Footwear and sugar will also be affected.
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