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Canada Asks Latin America To Gang Up On Giant US

CANADIAN Prime Minister Jean Chretien is warning Latin American countries that the United States will use divide-and-conquer tactics in the march toward a hemisphere-wide free-trade zone by the year 2005.

``We have to stay united, because the United States will try to divide us to the extent that is possible,'' Mr. Chretien said in a interview in La Nacion, an Argentine newspaper, on Jan. 21.

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The statement from the leader of the US's largest trading partner raised eyebrows among some US officials. And it comes just a month after the US, Canada, and 32 Latin American nations pledged at a Miami summit to work toward free trade in the Western Hemisphere.

Chretien, who is on an 11-day, six-nation tour of the region, hopes to counterbalance US economic might by coaxing Latin countries to work with each other and Canada first in opening trade, observers say. A united non-US grouping might collectively drive a tougher bargain with the US in future trade negotiations, they say.

``This is a historic Canadian strategy,'' says Michael Bliss, a historian at the University of Toronto. ``He is telling these countries that anyone that tries dealing with the US one-on-one is bound to be the mouse in bed with the elephant. Not only that, Chretien is trying to get all the mice together.''

The prime minister is in Chile Jan. 25, having already visited Trinidad and Tobago, Uruguay, and Argentina. On Jan. 26, he and the group of about 250 Canadian businesspeople accompanying him, will go to Brazil and then to San Jose, Costa Rica, where he is expected to meet with all of Central America's leaders.

One of the ``mice'' that Canada feels responsible for is Chile. Canada lobbied hard to get negotiations started on including Chile in the North American Free Trade Agreement. Chretien opposed the original, long-held US desire to work a separate deal with Chile.

``Prior to Miami, Washington wanted a bilateral deal with Chile,'' says a Canadian foreign affairs official who asked not to be named. ``We fought an uphill battle to get Chile into NAFTA on a multilateral basis.''

Chile is in final negotiations this year with the US, Canada, and Mexico in preparation for entering NAFTA. But even though it will hear from all three NAFTA partners, Chile may have an ear cocked especially toward US concerns, says Gordon Ritchie, former chief Canadian trade negotiator and an architect of the 1989 US-Canada Free Trade Agreement.

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``The earlier, very overt moves by the US to conduct negotiations with Chile on a bilateral basis are a not-so-delicate way of saying, `If you do the deal with us, the others will have no choice but to follow, so [even now that we're negotiating trilaterally] we're still the ones whose interest you have to pay attention to,'' Mr. Ritchie says.

But a Chilean official in that country's Washington embassy, while crediting Canadian efforts in its behalf, says the US has been well-behaved so far. ``We haven't felt any pressure,'' the official says. ``Yet it is true. We all feel very tiny in front of the US.''

To alleviate such insecurity, Chretien is trying to nudge Latin American nations away from any willy-nilly charge into a hemispheric trade deal by urging full development of the fledgling trade pact, called Mercosur in Spanish, which unites Brazil, Argentina, Paraguay, and Uruguay in a $750 billion union.

Chretien's swashbuckling trade adventures worldwide have defied predictions. At his election, he was depicted as having traveled little and as a poor English speaker who might embarrass Canada abroad. He was also pegged as someone who was disinclined toward foreign affairs.

Instead, Chretien has seized on exports as the future of Canada's prosperity, leading a trade mission to Mexico shortly after his election and later another to China and Asia. He has emphasized a diversification of fast-growing markets to move away from heavy dependence on exports to the US, recipient of about 80 percent of Canadian exports.

Snubbing the US, of course, wins political points with Canadians. Typically the US simply turns the other cheek. It is understood in Washington that Chretien was elected partly on a promise to dump former Premier Brian Mulroney's cozy approach with the US and keep Canada's southern neighbor at arm's length. Chretien, for example, has not yet visited Washington, something every prime minister in recent memory has done soon after election. Instead, President Clinton will go to Ottawa late next month.

Despite the close timing of presidential visit and harsh comments, there was minimal public reaction from Washington. A US trade representative spokesman says simply: ``I would ask you to look to the [domestic] constituency to which these comments appear to be directed.''

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