From: riese@litsuns1.epfl.ch (Marc Riese)
Newsgroups: can.politics,can.francais
Subject: extraits d'un article de Business Week. Quebec: What Price Freedom
Date: 31 Mar 92 16:28:11 GMT
Followup-To: can.francais


Voici quelques extraits d'un article intitule' "Quebec: What Price Freedom?"
qui est dans l'edition du 23 mars de "Business Week". Je n'ai pas le temps 
de les traduire mais je veux bien faire un resume' si quelqu'un me le demande.
Commentaires? 
Je n'ai jamais entendu parle' de rapports economiques non-Quebecois
qui sont optimistes sur le sujet de la separation. Existent-ils?

Here are some extracts from an article entitled "Quebec: What Price Freedom?"
that is in the March 23rd edition of "Business Week". I don't have time to
translate them - anyone else?
Comments?
I am yet to hear of non-Quebecois economic reports that are optimistic
about the subject of separation. Do they exist?

Marc Riese
Ecole Polytechnique Federale de Lausanne
Suisse

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"In a poll of Quebec's business leaders last year, 72% said sovereignty
 would improve their ecomony over time."

Many English-speakers "warn that Quebec would be crushed economically by a 
 breakup. It all shapes up to a national game of chicken that neither side 
 can win. International nervousness over this showdown has helped drive the
 Canadian dollar under 84 cents, from 89 cents last fall, forcing the 
 Bank of Canada to raise interest rates."

"Quebec has developed `an economic model different from anything else in
 North America,' observes Lloyd Atkinson, chief economist of the Bank of 
 Montreal. Often called Quebec Inc., the model is one of close cooperation
 among business, labor, government, and Quebec's huge financial institutions."

"A thriving province is one thing; a sovereign nation something else again.
 Many economists figure that an indepedent Quebec would be in for rough times
 in the first few years. Although Quebec hasn't suffered as much as Ontario
 in the recession, it has its weaknesses. Unemployment is high, and some of
 Quebec Inc.'s leaders are under pressure. Hydro-Quebec has postponed its
 critical $11 billion Great Whale hydroelectric project at least until 1993
 because of strong environmentalist opposition and New York State's desire
 to renegotiate its multibillion-dollar, 20-year contract on better terms. The 
 forest-products and clothing industries have been pummeled by the recession.
    Sovereignty could create a lot more economic pain, especially in the short
 run. `Even under the best of circumstances, there would be tremendous
 transition costs,' says Guy Saint-Pierre, chief executive of SNC Group Inc. 
 and co-chair of a group of Quebec business leaders opposed to sovereignty.
 [The article states that SNC-Lavalin is Canada's largest engineering firm.]
    Debt would be foremost. As a sovereign entity, Quebec would have to assume
 its share of Canada's $340 billion national debt. A study by Toronto-based
 C.D. Howe Institute warns that this could drive Quebec's debt load to a
 stratospheric 97% of gross domestic product. Spooked foreign investors could
 then force Quebec to pay a premium and perhaps two percentage points on its
 huge international borrowings. To quell fears, Quebec could then be forced to
 cut spending and raise taxes.
    On the trade front, Quebec would see relations with the U.S. sour despite
 the province's free-trade stance, as Quebec Inc.'s policies of subsidization
 come under fire. The U.S. Commerce Dept. is already challenging the low rates
 Hydro-Quebec offers industrial customers. Trade with Canada would also be
 strained. For starters, Quebec's dairy farmers, who now produce half the
 nation's milk, would lose their market to cheaper supplies."

"How Quebec would stack up:
 Strengths:
   - World's 15th largest economy, and 9th largest trading partner of the U.S.
   - Leading companies including Hydro-Quebec, Bombardier, and SNC-Lavalin
   - Strongly probusiness government, favoring free trade and pushing
     North America's most aggressive industrial strategy
   - Good labor relations with very few strikes
   - Well-developed financial institutions in place, with over $110 billion
     in assets
 Weaknesses
  - Would have to assume its share of Canada's $340 billion debt, causing
    severe debt load.
  - Creditors would force it to pay a stiff premium on international
    borrowings.
  - Would try to keep Canadian dollar. But this means ceding control over
    monetary policy.
  - Could face increasingly strained trade relations with both the US and 
    Canada.
  - Unemployment, already at 12%, would rise in the short run to higher 
    levels"

"As the fall deadline draws nearer, optimists are betting that the Canadian
 genius for muddling through will eventually prevail. They may be right, since
 the costs of divorce are beginning to dawn on many Canadians on both sides."