Jury Still Out on Free Trade Pact With U.S., Canada Says

The new U.S.-Canadian free trade agreement is working reasonably well so far, but the jury is still out regarding its ultimate effectiveness in dampening trade disputes between the two countries, Canadian Ambassador Derek Burney said Friday.

In an interview with reporters and editors of The Times’ Washington Bureau, Burney said the 10-month-old pact has spurred more trade and investment, and businesses on both sides of the borders have indicated that they plan even more substantial increases in coming months.

Burney hinted that the two sides are likely to cut their tariffs on imports more rapidly than required under the 10-month-old accord. He said negotiators expect to complete work in December on a tariff-reduction package that can be put into effect in January.

Certain Disputes Cited

“That will be a big shot in the arm for the agreement,” he said.

But Burney said individual disagreements remain, and an assessment of how well the accord--with its speeded-up procedures for resolution of specific trade disputes--has actually worked most likely will not be available for several more months.

Asked about the trade disputes being cited under the new U.S.-Canadian free trade agreement, he mentioned complaints concerning salmon and herring, lumber and lobsters.

In the wide-ranging interview, the Canadian ambassador also praised the Bush Administration, saying the two governments are involved in “a more intense kind of consultation” than was the case when Ronald Reagan was President.

He said the Bush Administration’s willingness to deal with the problem of acid rain--combined with more frequent contacts on other key issues--has prompted more cooperation from Canada in combatting drugs and on other top priority U.S. concerns.

More Self-Confidence

Burney said he believes that younger generations of Canadians are emerging with “fewer hang-ups about . . . their identity as Canadians” than their parents--a development likely to help in easing occasional frictions between the two countries.

“I think this is a function of a country (Canada) that is more comfortable with itself, more confident about itself (and) doesn’t feel as threatened by the American giant to the south” he said. “I think that’s a healthy thing.”

Burney suggested that Canada may reconsider its current opposition to America’s “Star Wars” Strategic Defense Initiative now that the Bush Administration has scaled back the scope of the Reagan-era proposal.

Ottawa initially refused to support the program on grounds that in Canadian eyes it violated the anti-ballistic missile (ABM) treaty of 1972. As originally conceived, Star Wars was to develop a massive shield to protect the North American continent from nuclear attack.

But the ambassador said that even though “the official position of the (Canadian) government is still one of reserve,” that ultimately could change, particularly if Ottawa decides to re-evaluate its stance in view of the new U.S. policy.

Foreign Service Officer

Burney recommended a plan Canada has instituted giving preference to immigrants from Hong Kong and other countries who are willing to invest $150,000 or more in a Canadian enterprise. He said it guarantees that immigrants are more highly qualified.

Burney, who has been in Washington since February, is a career foreign-service officer who most recently served as chief of staff to Canadian Prime Minister Brian Mulroney. He replaced Alan Gotlieb, who retired from government service late last year.