Canadians unhappy with progress in easing economic strains with US

The beginning of 1982 sees the all-important US-Canadian trade and investment relationship marred by serious conflicts and downgraded by an administration in Wahington that observers say appears more concerned with the Polish crisis and President Reagan's domestic program.

At stake is a smooth future during the early 1980s for the two countries, each of which is the other's largest customer.

The $60 billion US-Canada trade pattern is the largest bilateral relationship of its kind in the world.

The first two years of the '80s were marked by particularly bad relations between the two neighbors, based chiefly on growing American resistance to the strong Canadianization policies of the Trudeau government for domestic industries with high US ownership.

Chief among these is the already very controversial Canadian National Energy Policy (NEP), which began in late 1980 with a commitment to bring 50 percent Canadian ownership by 1990 to the petroleum industry, 70 percent US-owned.

American reaction against the NEP and the Canadianization measures within the US-dominated manufacturing sector by the Foreign Investment Review Agency (FIRA) has often been harsh, whether from the White House, Congress, or affected US companies.

This untypical anti-Canadianism from very influential American private and public sectors has been exacerbated by the equally untypical Canadian corporate invasion of the US economy which began in the late 1970s.

Since then, such American business sectors as real estate, life insurance, banking, and, to a lesser degree, manufacturing industries have been successfully penetrated or raided by giant Canadian corporations, because the Canadian companies are also concerned over the growing federal involvement in the private sector at home.

In such cities as Denver in the West and Atlanta and Miami in the deep South, the Canadian corporate presence in the early 1980s is very substantial, with the largest new inner-city buildings in the first two cities dominated by Canadian owners and capital.

The Reagan administration's Cabinet and congressional supporters who favor growth of private enterprise in a time of economic recession, appear, to Canadians, at least, very unhappy when that expansion is foreign-inspired.

Added to this are many longstanding areas of conflict between the United States and Canada, which a year ago the incoming Reagan administration promised would receive its early attention.

These include the former fisheries treaty passed by Canada's Parliament in March 1979 but held up in the US Senate and then abrogated last winter by Mr. Reagan. Another dispute centers on growing acid rain pollution from American industries to the south.

Though Canadians remain angry about the fate of a fisheries treaty, which had taken years to formalize, the Reagan administration's growing and open support for the greater use of coal as an industrial fuel infuriates the Trudeau government. Leaders in Ottawa point to coal-fired plants in the American Midwest as the major source of Canada's acid rain pollution, chiefly in its most populous province, Ontario.

And there are persistent reports that Reagan has approved an official US government appeal to GATT (General Agreement on Tariffs and Trade) officials to arbitrate on the Canadian insistence that FIRA must rule in favor of Canadian-owned production outlets for American industries entering this market. Such appeals are usually a measure of last resort.

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