Quebec's fervor for separatism ebbs, but not business exodus

Quebec separatism, which once threatened to split the Canadian nation asunder , has faded - at least for now. But the legacy of the decade of separatist fervor lingers.

It is a legacy of a provincial economy gone sour. The economy of French-speaking Quebec, concentrated in this cosmopolitan city on the St. Lawrence River, was once a major factor in the overall dynamics of Canada's economy.

With the fervor for separatism stalking the province, however, a damaging exodus of companies began in the late 1960s - an exodus that continues. In August, Avis, the big auto rental firm, announced it is moving its corporate headquarters from Montreal - thus joining a migration that has seen even the Bank of Montreal transfer much of its national and international business to Toronto.

It is estimated that 140 major Canadian and foreign companies, as well as perhaps 200,000 Quebeckers, left the province in the past decade, worried by the talk of separatism and the French-language laws that forced most English-speaking Canadians here to do business in French. In all, the exodus is costing Quebec some $2 billion yearly.

''What worries me,'' says Montreal businessman Rene Fortescue, ''is that we may never recover from this exodus of companies and business people. There just is no confidence in Montreal and Quebec. Look around you and you can see the effects of this migration. We used to be the fashion capital of Canada, the center of culture. But no more.... The rest of Canada has passed us by.''

But not all the economic news here these days is bad. French businesses, eager to crack the Canadian and United States markets, are investing in Quebec, finding it easy to start in French-speaking Montreal before tackling the bigger national markets. Last year, they invested $29 million - about 40 percent of all new business investment in the province.

And the Port of Montreal recently announced a five-year, $175 million renovation and expansion program. It is Montreal's location on the St. Lawrence as the first port in Canada that makes its facilities so important.

A Royal Bank of Canada spokesman adds: ''If there was a port upriver, Montreal would be a goner.''

Quebec's high tax rate for individuals also makes the area unattractive to business. It is about double that of Ontario.

Moreover, a law barring businesses from hiring nonunion workers or using management in the event of strikes was adopted by the provincial legislature last year.

There is evidence that the ruling Parti Quebecois, headed by Rene Levesque, recognizes that such measures harm the province's economy. Mr. Levesque has obtained some changes in Quebec's language law, making it easier to educate children in English, to conduct business in English-speaking institutions, and to pass professional examinations without an expert's knowledge of French.

Eric Maldoff, president of the Alliance Quebec, an organization of some 40, 000 English-speaking Quebeckers, says the worst is over. ''We've gone through the most difficult moments. A spirit of optimism has begun to develop in the English-speaking community.''

But there is lingering concern within business and government circles that the damage done by separatism will not easily be overcome.

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