TRADE TALK - LEO RYAN US STATE LEGISLATORS GET SEPARATISTS' TAKE ON QUEBEC TRADE

TRADE TALK - LEO RYAN US STATE LEGISLATORS GET SEPARATISTS' TAKE ON QUEBEC TRADE

It was one of those typically balmy summer days in Quebec City, with thousands of American tourists strolling the cobblestone streets and along the St. Lawrence River.

On this particular day, Monday, Aug. 7, the capital of Canada's French- speaking province was also playing host to the eastern regional conference of the Council of State Governments.But clearly some of the U.S. state legislators in attendance underestimated the political mine field they had entered, with a referendum on Quebec sovereignty presumably just a few months away. Jacques Parizeau, the premier of Quebec, was clearly relishing the chance to use the event to boost the struggling secessionist cause.

In his keynote speech, Mr. Parizeau promised there would be no disruption of trade if Quebec separated from the rest of Canada, also known as ROC.

FREE TRADERS ALL

"Obviously," Mr. Parizeau said, "free trade is the cornerstone of Quebec's policy. It so happens that you are now in the capital of a nation of free traders."

He continued that Quebec's north-south trade was growing more quickly than the province's trade with the rest of Canada. "A significant part of our future lies in the surge of north-south trade."

Then, various state legislators chimed back messages that were music to Mr. Parizeau's ears, even if they appeared to be just stating the obvious.

"We look forward to a continuing relationship with Quebec, no matter what the people of Quebec choose, one way or the other," said John Bennett, the New Jersey Senate majority leader.

Burton Cohen, a New Hampshire state senator, said his state was interested in increasing trade with Quebec "whether it stays part of Canada or becomes more of a sovereign nation."

Mr. Parizeau has long argued that Quebec's neighbors will want to do business with a sovereign Quebec.

U.S. AMBASSADOR'S REJOINDER

However, James Blanchard, the U.S. ambassador to Canada, told reporters that ''state legislators . . . don't speak for the federal government - they speak for themselves."

"The wise thing to do is to not comment on what might be," Mr. Blanchard said.

"All I can tell you is, we like what is," he said, reiterating the official Washington position that the United States enjoys excellent relations ''with a strong and united Canada."

As part of its pre-referendum strategy, the separatist Parti Quebecois has been downplaying the importance of interprovincial trade and stressing that growth of Quebec-U.S. trade is much faster than its trade with the rest of Canada.

Critics point out that Quebec trade with the United States may be growing faster, but it is from a smaller base.

For instance, in 1989, the most recent year of complete interprovincial trade statistics, Quebec shipments to the rest of Canada totaled C$24 billion (US$17.5 billion) compared with exports of C$16.9 billion to the United States.

In 1994, Quebec merchandise exports to the United States climbed more than 15 percent to C$33.7 billion.

IMPACT OF CANADIAN BREAKUP

''Quebec is simply mirroring the Canadian experience in the trading relationship with the United States," commented Daniel Schwanen, a senior policy analyst of the C.D. Howe Institute, a well-known Canadian think-tank in Toronto.

In an interview, he recalled that the best-case scenario for the Parti Quebecois government in a potentially hostile environment in Canada is predicated upon at least 90 percent of the internal trade remaining intact.

"Even if there is no more than a 10 percent drop in this internal trade, you are talking a lot of jobs in a Quebec economy where unemployment is already above the national average," said Mr. Schwanen.

He suggested that such a decline would not necessarily be offset by increased trade with the United States and other foreign partners.

Meanwhile, Quebec political circles are in ferment as crunch time approaches to pick a referendum date this fall. Latest opinion polls suggest growing support for the sovereignty option, but it is premature to determine whether this trend will hold.