Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Patrick Lamarre, president and CEO of SNC-Lavalin Nuclear Inc., announces the acquisition of the CANDU reactor division of Atomic Energy of Canada Limited. (Della Rollins For The Globe and Mail)
Patrick Lamarre, president and CEO of SNC-Lavalin Nuclear Inc., announces the acquisition of the CANDU reactor division of Atomic Energy of Canada Limited. (Della Rollins For The Globe and Mail)

NEIL REYNOLDS

AECL sale a long overdue move Add to ...

Early in 1972, as he approached the end of his first term as one of Canada's most authoritarian prime ministers, Pierre ("Just watch me") Trudeau took Canada into the secret, state-sponsored international cartel that rigged world uranium prices for four years. When the existence of the cartel became known in 1976, Mr. Trudeau signed the order-in-council that declared it a crime, punishable by five years in prison, for any Canadian to discuss details of the cartel in public. Perhaps this misadventure doesn't quite qualify as proto-fascist. But it comes close: The word describes the early stage of an alliance, with totalitarian propensities, of a state and the corporations it chooses as its partners.

More from Neil Reynolds

Largely organized by Canada, the cartel - or "the Club," as participants called it - controlled 25 per cent of uranium supplies at a time when the world price fell to $4 a pound and supply exceeded demand by 400 per cent. Membership was by invitation: the governments of Canada, France, Australia and South Africa, and selected big mining companies. Among these companies was Rio Tinto Zinc, the British conglomerate with mines in South Africa and Namibia; and Gulf Oil (Canada). Oddly, the British government was not invited; nor was the U.S. government; nor was any U.S. company (except, indirectly, the U.S. parent company of Gulf Canada).

The cartel begot four decades of questionable moves by Atomic Energy of Canada Ltd. (AECL). In fact, Canada would have been smart to close its nuclear-reactor business in 1972. Had it done so, it would have saved the country more than $20-billion in the ensuing 40 years. But the Club did work. Within a year or so, it raised the price of uranium to $40 - saving miners' jobs in Ontario and Saskatchewan. But AECL was never able to sell its Candu reactors abroad - except to dictatorships (Argentina) and deadbeats (Romania).

In the early 1970s, AECL sought Candu orders in Europe: Greece, Italy, Denmark - and Romania. Later, it courted poorer countries: China, Venezuela, Yugoslavia, Indonesia and, again, Romania. AECL emerged from the 1970s with a single Candu sale: Romania in 1978. Yet AECL knew that it needed to sell a minimum of two Candu reactors a year just to survive.

By the end of the 1970s, U.S. light-water reactors had captured both the U.S. and European markets, leaving Canada to sell its heavy-water reactors to countries either odious or poor. Canada sold a reactor to Argentina, for example, in 1974 - a sale that coincided with the repressive rule of the military junta that left thousands (perhaps 30,000) of Argentines dead or "disappeared."

In this instance, Canada's honour was salvaged by the celebrated longshoremen in Saint John, who refused to load heavy water bound for the Candu reactor in Argentina - an action remembered last year when Argentina awarded one of its highest honours to the longshoremen's union. The dock workers were never required to load the heavy water. The government trucked it secretly by night to Montreal's Mirabel airport and flew it to Argentina instead.

Mr. Trudeau showed similar disdain for human rights when he travelled, as AECL's top salesman, to Seoul in 1980. He arrived shortly after South Korean soldiers had killed 1,200 civilians in violent street demonstrations.

But it was with the uranium cartel that the Trudeau government morally hit bottom. Rio Tinto Zinc, the largest corporate partner in the group, operated uranium mines in Namibia - in violation of orders from the International Court of Justice. The UN found, in a 1982 report, that Namibian uranium was mined by virtual slaves who laboured under brutal working conditions, was processed in secret locations, was marked with false labels and shipping orders, was owned by a tangle of multinational corporations and was used, in part, "to build the nuclear power of an outlaw country," referring to apartheid-governed South Africa.

It's a bit rich now to hear Liberal MPs accuse Prime Minister Stephen Harper about the secrecy surrounding the sale of AECL, as Ottawa South MP David McGuinty did the other day, citing "zero transparency … zero parliamentary debate … zero accountability" on the sale. Although the legacy of corrupt government practices in the past will survive for decades to come, Mr. Harper's sale of AECL to SNC-Lavalin is a cleansing action, long overdue - and, judged properly, a small step toward the "just society" that Mr. Trudeau professed to champion.

 

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories