QUÉBEC UPDATE

January 17, 1995

A selection of news from Québec published by the Ministère des Affaires internationales, de l'Immigration et des Communautés culturelles.

PRIME MINISTER PARIZEAU TO VISIT FRANCE

Québec Prime Minister Jacques Parizeau will undertake an official visit to France during the last week in January. Mr Parizeau will meet with French President François Mitterand on January 25 and with Prime Minister Édouard Balladur the following day.

This visit will mark the resumption of periodic alternating visits by the French and Québec Prime Ministers, interrupted since 1989. It will revitalize cooperation between France and Québec at the highest levels and give a new impetus to numerous issues of mutual interest, notably in the fields of education, communications, culture, the regions and the economy.

BERNARD LANDRY TO VISIT SWITZERLAND AND GERMANY

Deputy Prime Minister and Minister of International Affairs, Immigration and Cultural Communities Bernard Landry will visit Davos, Switzerland and Munich, Germany, from January 27 to 31.

In Davos, Mr Landry will participate in the annual World Economic Forum that brings together political, economic and financial leaders from around the world. In particular, he will hold talks with the Swiss Minister of Foreign Affairs and the Vice President of Rumania, in addition to meeting with several foreign industrialists whose firms already operate in Québec or who wish to set up operations here.

In Munich, Mr Landry will meet with his counterparts from Bavaria in conjunction with the Québec - Bavaria Cooperation Agreement. He will hold talks with Dr Edmund Stoiber, Minister- President of Bavaria, and Johann Bohm, Speaker of the Bavarian parliament.

LEGISLATION TABLED ON THE IMPLEMENTATION OF INTERNATIONAL TRADE AGREEMENTS

On December 19, 1994, Deputy Prime Minister and Minister of International Affairs, Immigration and Cultural Communities Bernard Landry tabled in the National Assembly draft legislation respecting the implementation of international trade agreements.

The bill calls for the approval of the North American Free Trade Agreement (NAFTA), the Environmental Cooperation Agreement, and the Labor Cooperation Agreement, the latter two in parallel with NAFTA, and the Agreement Establishing the World Trade Organization (WTO). It also harmonizes internal Québec law with the international obligations to which Québec is subscribing in order to ensure the implementation of the agreements.

"Québec will be the first province to implement NAFTA and the outcome of the multilateral trade negotiations under the Uruguay Round," noted Mr Landry. "In this way, we are resolutely displaying our openness to the world economy and our determination, once we achieve sovereignty, to pursue free trade with our neighbours."

Through the legislation, Québec wishes to indicate its willingness to fully exercise its constitutional power to implement international agreements that it supports and which affect its fields of jurisdiction. "Moreover," he stressed, "the Québec government is showing that it is willing to continue to participate in the sweeping trend toward freer trade the world over, at a time when international trade negotiations are focusing increasingly on areas under provincial control in Canada."

HUMANITARIAN MEASURES FOR HAITI

On December 22, 1994, Québec Minister of International Affairs, Immigration and Cultural Communities Bernard Landry announced a series of humanitarian measures in favour of the Haitian people. He also indicated that the Québec government intends to bolster its bilateral relations with Haiti in order to help rebuild the country and consolidate democracy.

The Québec government will earmark $400 000 for the implementation of various humanitarian measures. For example, it will assume the cost of shipping 12 containers filled with medical and school equipment and supplies collected in Québec through the generosity of individuals and institutions. Moreover, a special $100 000 Québec-Haiti fund has been turned over to the Association québécoise des organisations de coopération internationale to finance development assistance projects submitted by Québec agencies already working in Haiti.

Québec specialists will be seconded to Haiti for periods of two to six months, at the request of the Haitian government. They will offer technical advice to the ministers of planning and external cooperation, education, public health and population, and at the Hôpital général in Port-au-Prince.

QUÉBEC PRESENTS A COMPREHENSIVE OFFER TO THE ATIKAMEKW AND MONTAGNAIS

On December 15, 1994, the Québec government presented a comprehensive offer to the representatives of the Atikamekw and Montagnais nations with a view to settling their land claims. The offer centres on two basic principles, autonomy and partnership.

It proposes the establishment of 12 domains, covering an area of 4 000 km2, 10 times the area of the existing reserves. The lands, to be transferred in full ownership, would serve as the territorial basis of the autonomous Atikamekw and Montagnais governments. Moreover, the autonomous governments will dispose of significant political powers in the realms of education, the administration of justice, health, social services and income security, and in key sectors that are essential for development and the protection and promotion of the aboriginal way of life and cultural identity. The governments will also be empowered to administer fiscal measures within the territories.

The Québec government is also willing to grant exclusive trapping rights and hunting, fishing and food-gathering rights for the purpose of subsistence within traditional activity areas. It will share with the autonomous Atikamekw and Montagnais governments the tax revenues generated by the areas, covering 40 000 km2, and involve the governments in decision-making with respect to the development and allocation of public lands.

A set number of conservation areas, totalling not more than 10 000 km2, will be established for the Montagnais. Certain historic and cultural sites will be protected.

The offer also calls for the Québec government and the Government of Canada to provide $342 million in compensation. This amount is comparable to that paid to the Crees and Inuit under the James Bay and Northern Québec Agreement.

The Québec government hopes to conclude agreements in principle with its aboriginal partners during the year.

The 17 000 Atikamekw and Montagnais in Québec live in 12 communities. Three Atikamekw communities are located in the Haute-Mauricie region. Seven Montagnais communities are are found in the Côte-Nord region along the shores of the Saint Lawrence River, and two others are located in the Lac Saint-Jean and Schefferville regions.

EXPORTS FUEL ECONOMIC GROWTH IN 1994

"Québec is open to the world and the current revival of its economy is due by and large to exports. Freer trade in recent years and the signing of the Canada-United States Free Trade Agreement in 1989 led, among other things, to a 23.7-percent increase in international exports in 1993 and a 19.5-percent increase in 1994."

Québec Minister of Industry, Trade, Science and Technology Daniel Paillé made this observation on December 19, 1994, during a press conference at which he presented a profile of the manufacturing sector in 1994.

Mr Paillé noted that the marked upturn in exports over the past two years nudged Québec's real gross domestic product up by 1.8 percent in 1993 and by 3.4 percent in 1994. The increase resulted in the creation of 69 200 full-time jobs during the first 11 months of 1994.

According to the Minister, the manufacturing sector, which accounts for over 90 percent of Québec's total international exports, made a crucial contribution. Manufacturing exports rose by 27.3 percent in 1993 and by 19.4 percent during the first eight months of 1994, equivalent to a two-year increase of nearly 45 percent. Transportation equipment (+35.2 percent), wood (+46.4 percent), primary metals (+30.3 percent), plastic products (+34.9 percent) and chemical products (+23.2 percent) recorded the best results.

The pronounced upturn in exports led to a 10.8-percent increase manufacturers' shipments during the first nine months of 1994 and to the creation of 25 800 new jobs in manufacturing. Capital expenditures in the manufacturing sector were up by 25.8 percent during the year, the first increase since 1990. Nearly 90 percent of the outlays were earmarked for machinery and equipment purchases.

"Québec's growth prospects in 1995 are encouraging, despite foreseeable increases in interest rates. Exports will continue to bolster growth, along with consumer spending. There is every indication that the Québec economy will enjoy growth on the order of 3 percent to 3.6 percent, thus making it possible to create between 60 000 and 70 000 new jobs," Mr Paillé concluded.

QUÉBEC SMBs OPTIMISTIC

Québec small and medium-sized businesses (SMBs) claim to be optimistic about economic performance in 1995. They anticipate creating nearly 55 000 new permanent jobs during the year. These figures were revealed in a survey conducted by the Canadian Federation of Independent Business (CFIB) among 1 592 SMBs in Québec.

According to the survey, 45 percent of the SMBs questioned believe that the economy will be more robust in 1995 than in 1994, 47 percent think that it will remain stable and only 8 percent expect a downturn. "This wave of optimism confirms that entrepreneurs are convinced that the economy is recovering. Such an attitude cannot help but to foster job creation," noted Pierre Cléroux, Québec Vice President of the CFIB.

SNC-LAVALIN TO BUILD AIRPORT IN KENYA

SNC-Lavalin of Montréal has obtained a $115-million contract from the Kenyan government to build an international airport in Eldoret, 400 km from Nairobi.

The contract calls for the construction of a 3.5-km runway suitable for aircraft such as the Airbus A310, a 2 400-m2 terminal, a control tower, ancillary buildings and a freight warehouse. Work on the two-year project is slated to begin in January 1995.

SR TELECOM WINS $75-MILLION CONTRACT IN SAUDI ARABIA

SR Telecom of Saint-Laurent has signed a five-year purchase agreement with AT&T International to supply its SR500 telecommunications stations used in microwave-based telephone networks.

The US$75-million contract was obtained in conjunction with a US$4-billion project administered by AT&T to supply Saudi Arabia with 1.5 million telephone lines over a period of seven years.

LUFTHANSA BUYS EIGHT BOMBARDIER REGIONAL JETS

Canadair, a subsidiary of Bombardier, has received an order worth US$146 million from Lufthansa Cityline, a German airline, for eight new twin-engine Regional Jets. Lufthansa is already operating 15 of the 50-seat aircraft, designed for short and medium-haul flights, on its European route network.

BOMBARDIER WINS $153-MILLION CONTRACT

New Jersey Transit has awarded a $153-million contract to Bombardier to manufacture 95 commuter train cars, to be assembled at the Montréal firm's facilities in La Pocatière, Québec and in Barre, Vermont. The first cars are slated for delivery in the third quarter of 1996.

SEAGRAM BUYS DOLE FOODS COMPANY

Seagram of Montréal has acquired the operations of Dole Food Company, an American company specializing in fruit juice. The deal is worth US$285 million.

The Montréal firm will integrate the Dole product line, marketed under the Dole, Juice Bowl, Looza and Fruvita labels, into its Tropicana Products subsidiary. Under the deal, Seagram is acquiring Dole's industrial facilities in the United States and in Europe, and its stake in joint ventures in Japan and China. Dole's pineapple juice operations are excluded from the agreement.

Seagram, whose head office is located in Montréal, is a leader in the production and marketing of spirits, wine, fruit juice, coolers and mixers. It sells its products in over 150 countries.

INDUSTRIES LASSONDE STRIKES DEAL WITH US FIRM

Industries Lassonde of Rougemont has concluded a strategic alliance with Clement Pappas & Co. of New Jersey concerning technological exchanges and the reciprocal use of the partners' sales and distribution networks in Canada and the United States. The deal should enable the Québec company to make significant inroads on the US market.

Clement Pappas & Co. is a leader in the manufacture and marketing of fruit juices and fruit sauces, sold through retail food stores, food wholesalers and purchasing groups in the United States. Industries Lassonde ranks first in Québec, where it accounts for 36 percent of the juice market and 32 percent of the fruit drink market.

BANK OF MONTREAL TO OPEN NCH IN CHINA

The Bank of Montreal has been authorized by Chinese officials to open a branch in Guangzhou, the capital of Guangdong province. The branch will provide international trade financing services aimed at companies doing business in China and in North America.

CANADIAN CONSORTIUM LANDS RUSSIAN CONTRACT

A consortium led by DMR Inc. of Montréal has won a $4.5-million contract covering a pilot project to implement a land-registry office and a land-reform management system in the Dmitrov region, roughly 80 km north of Moscow.

In addition to DMR, the consortium is made up of Roche Ltd.-Consulting Group of Québec City, Tecsult International Ltd. of Montréal and UMA Engineering Ltd. Of Edmonton.

SITQ IMMOBILIER INVESTS IN EUROPE...

SITQ Immobilier has just made two acquisitions, one in Belgium, the other in the United Kingdom, in an investment totalling C$40 million.

In Belgium, the company has bought, in equal partnership with the Compagnie immobilière de Belgique S.A., an office building with 230 000 square feet of leasable space, located in a prestigious area of Brussels. In the United Kingdom, SITQ has acquired, with its British partner, Pillar Properties, a 173 000-square-foot shopping centre in downtown Ballymena.

...AND IN MEXICO

SITQ Immobilier has invested C$13.5 million, equivalent to 30-percent share, in a residential construction project in Mexico. Terrum Group, Mexico's largest real estate developer specializing in the construction of single-family homes and condominiums, owns 60 percent of the project, and Terrum Investment Fund, the remaining 10 percent.

The project calls for the construction of two private housing complexes in Cuajimalpa, a suburb of Mexico City, and a third complex in Leon, located in the centre of Mexico.

SITQ belongs to the Groupe immobilier of the Caisse de dépôt et placement du Québec, which manages retirement funds and public insurance plan funds.

FAMIC WINS CONTRACTS IN INDONESIA

Famic Inc. of Saint-Laurent has won an $850 000 contract from Putranata, a Jakarta, Indonesia, firm, for the manufacture and delivery of 10 hydraulic simulators and six pneumatic simulators for use in technical training schools in Indonesia. The systems are equipped with software and instructional materials designed by Famic.

The Québec company will also supply a $300 000 mini-plant to a training college in Cameroon, to be used for the teaching of industrial mechanics and electrical engineering. The mini-plant, dubbed SATEA (automated aggregate processing and bagging system), is equipped with devices such as programmable automatic control systems and simulates an industrial aggregate washing, drying and bagging process. The system is already found in 20 vocational training schools in Québec.

MARCONI AWARDED CONTRACTS IN THE US AND JAPAN

Canadian Marconi Co. of Montréal has obtained two contracts worth US$1 million for its IRC- 160 infrared camera, developed and manufactured by its Cincinnati Electronics unit of Mason, Ohio.

The first contract is a breakthrough with the US Coast Guard. It involves the supply of cameras to be used, among other things, to locate and assess environmental hazards such as oil spills and for search and rescue operations. The second contract, with Avio of Japan, calls for the supply of cameras that will be integrated into the TVS-8000 thermal video system, which was jointly developed by Cincinnati Electronics and Avio. The TVS-8000 is widely used by industry in conjunction with R&D and quality control.

SHERBROOKE GROUP ACQUIRES HOCKEY STICK PLANT

A group of Sherbrooke businesspeople has just bought the Sherwood-Drolet Ltd. hockey stick and sports equipment plant from Figgie International Inc. of the United States.

The plant, with sales of $30 million, is located in Sherbrooke and employs 200. It manufactures over 200 models of hockey stick and protective equipment for hockey players. Its products are sold the world over and account for 30 percent of the North American market.

FRENCH MUSEUM TO USE QUÉBEC SOFTWARE

G.C.I. Inc. (Gestion de collections Innes) of Québec City has sold its Archémuse 111 software to the Musée national des techniques de France. Several Québec museums use the museum collection management software.

HYDRO-QUÉBEC UNVEILS MAJOR TECHNOLOGICAL BREAKTHROUGH

In early December, Hydro-Québec, a government corporation, unveiled a major technological breakthrough in the realm of research and development devoted to electric vehicles: a high- performance, environmentally friendly power train.

The technology has been dubbed the Couture Powertrain (CPT) (Groupe de Traction Couture: GTC), after its designer, Pierre Couture, a researcher at the Institut de recherche en électricité du Québec (IREQ). It features a motor installed in each of the four wheel hubs of the automobile. The motors run on a hybrid energy source, consisting of a battery pack and an internal combustion engine connected to a generator that supplies both the battery and the motor wheels.

The battery, located in the trunk of the car, gives the vehicle a range of 65 km, beyond which the generator takes over and recharges the battery. Once the battery is recharged, the generator stops and the vehicle continues in electric mode. The battery can also be recharged from a conventional power outlet.

According to Mr Couture, the motor wheels are particularly efficient: the vehicle can accelerate from 0 to 100 km in nine seconds and maintain a cruising speed of between 100 and 120 km/h. Moreover, braking energy is recycled as electricity, which is returned to the battery. The CPT only uses energy when the vehicle is moving, thus allowing considerable energy savings in relation to conventional cars. The absence of the traditional gears, axles, transmission and differential means that the underside of the car is perfectly smooth, thus reducing aerodynamic resistance.

"Because of its technical and environmental performance, energy efficiency and reliability, the GTC is a serious candidate in the race to develop the car of the 21st century," noted Armand Couture, President and Chief Operating Officer of Hydro-Québec.

DORVAL FIRM MAKES TECHNOLOGICAL BREAKTHROUGH

FSF Research Technologies of Dorval has just made a revolutionary breakthrough in the realm of semiconductors: the manufacture of a totally redesigned gallium arsenide chip that is much more economical than existing chips.

Company President Fareed Sephery-Fard has told Montréal daily La Presse (January 5) that negotiations are under way with several Japanese, American and European giants interested in forming an alliance with his company.

The gallium arsenide integrated circuit is used above all in the wireless telecommunciations sector, where rapid data processing is essential. Researchers in Dorval have succeeded in manufacturing more economical integrated circuits on gallium, using a faster process that does not require corrosive gases and vacuum systems.

"On a small gallium arsenide 'wafer' three inches in diameter, we install 60 to 70 transistors of different types, depending on the desired application," Mr Sephery-Fard explains. "These applications consist of deciphering digital television signals, wireless telephone or cellular telephone signals, or signals generated by communications between personal computers or fax machines." In 1995, FSF Research Technologies plans to produce 'wafers' that are six inches in diameter, capable of containing even more circuits, which will further reduce production costs.

The gallium chip has a capacity of up to 50 to 60 gigahertz (GHz), compared with half a gigahertz for the fastest silicon chip. The gallium arsenide integrated circuit produces less background noise, is more compact and consumes less energy than its equivalent on a silicon chip. Gallium arsenide better resists cosmic rays, an advantage with respect to space and military applications.

MONTRÉAL TO HOST AMERICANA 95

From March 21 to 24, Montréal will host Americana 95, a huge scientific, technical and commercial exhibition devoted to the environment. Some 275 exhibitors and 4 000 visitors from Canada, the United States and Latin America are expected to attend the event, organized by the Association québécoise des techniques de l'environnement.

In addition to the technical exhibition, the organizers have planned a commercial section and a complete program of activities including workshops, industrial visits and conferences focusing on water management and treatment, waste treatment and the decontamination of soils.

QUÉBEC SIGNS AGREEMENT WITH IISMO

The Québec government has signed an agreement with the International Inflight Service Management Organization (IISMO).

The agreement covers the recognition and granting of certain benefits such as health insurance, driver's licences and tuition fees to facilitate the establishment in Québec of this international non- governmental organization. Other provisions are aimed at making it easier for IISMO employees to integrate into Québec society.

IISMO was founded in 1966 and established its headquarters in Montréal in 1992. The organization seeks to promote the quality of inflight service and to foster cooperation between the business community, industry, international organizations and government agencies to enhance the quality of inflight service.

QUEBECER NAMED BEST INTERNATIONAL WINE STEWARD OF 1994

François Chartier, a Quebecer, won the title of Meilleur Sommelier International en Vins et Spiritueux de France at a competition held in Paris on December 11 and 12, 1994. The top wine stewards from 23 countries participated in the competition, organized by Sopexa, a French firm.

Mr Chartier is the wine steward at the Bistro à Champlain in Sainte-Marguerite-du-Lac-Masson. The Canadian Association of Professional Sommeliers chose him last fall to represent Canada at the Mondial de la Sommellerie competition to be held in Tokyo in May 1995.

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For further information, please contact Pierre Delage at MAIICC, Direction des communications, (418) 649-2345.