Trudeau readies for clash with Reagan over relations with third world

Prime Minister Pierre Trudeau, intent on liberalizing the world economic order, appears headed for a confrontation this summer with President Reagan. The clash may come at this summer's economic summit, where the topic of rich vs. poor nations will dominate discussions. The annual meeting of the world's seven most industrialized noncommunist countries -- the US, West Germany, Italy, Canada, Japan, Britain, and France -- will be held in Ottawa July 20 and 21.

At Mr. Trudeau's insistence, the deep-seated differences in economic development philosophy that separate the most prosperous nations from the third world will be the top item on the agenda.

Discussions on these issues, commonly known as the North-South dialogue, have faltered in recent years, and Mr. Trudeau hopes the Ottawa summit can rekindle interest in the enormous problems facing developing countries.

He has been stressing the urgency of this issue, saying the industrialized democracies have "a very important responsibility" to show they can resolve international problems "with greater justice than the opposing faction."

Recently Mr. Trudeau has come close to singling out the United States as a major stumbling block to better North-South relations.

In mid-May he warned that the world economic order is changing and countries like the US would be wiser to face up to this prospect than ignore it.

"It's better to help fashion those changes than to be victims of them," Trudeau said.

As for Mr. Reagan, Mr. Trudeau hopes the coming international meetings in which the US President is participating will "make him understand the importance for countries of the prosperous North, and the US in particular, to participate actively in the solution of these grave problems."

The cooperation of the US, the world's largest aid donor in cash terms, is crucial if negotiations on a greater sharing of global wealth are to succeed.

Mr. Reagan has ordered a general review of US policy on this issue. But his administration, with its dislike of government intervention, would seem opposed in principle to the huge transfers of funds from rich to poor favored by Trudeau and other leaders.

Mr. Reagan wants to ax $1 billion from the $12.2 billion US foreign aid budget.

As is well known, a handful of countries --mostly in the Northern Hemisphere -- enjoy more than 60 percent of world income though they comprise less than 20 percent of the world's population. The gulf between these rich countries and the poor nations of the Southern Hemisphere is considered today's most serious problem.

Willy Brandt -- a Nobel Prize-winner and former West German chancellor -- set up an independent commission in 1977 on this issue. It recommended a major effort to help the third world in order to avoid "the threat to human survival posed by the threating chaos in the world economy."

Canada, an industrialized country which as a mineral producer shares some of the economic problems of developing nations, has traditionally seen itself as a potential mediator in the North-South dialogue.

Mr. Trudeau has undertaken three highly publicized trips in the past year to the Middle East, Africa, Europe, and South America in which he has tried to break the deadlock now holding up North-South negotiations.

Mr. Trudeau is pressing for action not only at the July summit but also in a Commonwealth summit in Australia in September and an October mini-summit on North-South relations in Mexico.

The Reagan administration, however, injected a note of tension by insisting that Cuba, which the US charges has contributed to the fighting in El Salvador, be excluded from the Mexican conference as the price of US participation.

Mr. Trudeau's proposed agenda for action on North-South problems includes an international effort to help third-world countries improve their own energy production, thereby freeing them from the grip of the Organization of Petroleum Exporting Countries. He also favors more agricultural aid to poor nations. And he wants the International Monetary Fund to ease up its requirements for helping third-world countries with chronic balance-of-payments problems.