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For most of the nearly two centuries since it was first settled by British soldiers, the town of Huntingdon has been serenely oblivious  to most of the rest of the world and even the rest of Canada.

The city of Montreal is only an hour's drive away,  and the United States border is just down the road, but the citizens of Huntingdon  were usually  content to stay close to home.

The first mills were for flour and grist, but at the beginning of the 19th century, Huntingdon became a textile town. The textile mills did not pay big-city wages, but measured against the income of the surrounding farming community, it seemed like pretty good money.

However, this year, the outside world has started to crowd in on Huntingdon and it is already clear that life in the town will never be the same again.

First, the 215 employees of Huntingdon Mills were told that the mill was bankrupt and was shutting its doors. On that same day, the 600 workers at Cleyn & Tinker learned that their mill, too, was shutting down in the spring, its customer list having been sold to a US mill.

For a town of 2,600 people, it was shattering news. But there are mill towns like Huntingdon all over Canada - and all over the US - and they may all face  the same fate.

The warning of Canada's minister of industry, David Emerson, was unmistakable: 'There is nowhere to hide in the world of trade and textiles.'

Like most other countries around the world, Canada dropped quotas on imports of textiles and apparel on January 1, opening the door to unrestricted imports from low-wage developing countries.

Two years ago, in anticipation of the end of the Multifibre Arrangement (MFA), the Canadian government dropped quotas on clothing imports from the 48 poorest  developing countries, including Bangladesh and Cambodia. In the  months that followed, the clothing manufacturing industry lost more than 15,000 jobs.

Despite the  deepening inroads made by cheap imports, the clothing and textile industries are worth almost US$11.5 billion to the Canadian economy. Both sectors provide jobs for 150,000 workers but that is a drop of more than 50,000 in the past four years.

In recent years, clothing and textile manufacturers have benefited from the 1988 Free Trade Agreement that has allowed Canadian goods to flow freely into the US and which has seen  exports grow from US$650 million in 1989 to US$2.7 billion in 2003.

But the unrestricted entry of cheaper goods into the US from the developing world and a 16 per cent increase in the value of the Canadian dollar since the  beginning of the year are expected to dampen that trade flow.

Canadian manufacturers point to at least one significant advantage that will not change - their  plants are closer to US markets and have easier access across the border for fast deliveries if there are changes in market demand.

One surprise is that Canada remains the foremost producer for the US of men's suits in the mid-price range.

Although there are a few bright  spots, both the textile and clothing industries fear that the insurmountable obstacle they face is labour costs.

As one manufacturer told a Toronto newspaper, the average wage in overseas plants is US$25 or US$30 a month. Good workers in his Toronto plant could make that much in a single day by lunchtime, he said.

In the days leading up to the January 1 expiry of the MFA, the Canadian government announced a US$500 million, five-year programme to help Canadian manufacturers over the hump.

Tariffs on imports of textiles have been eliminated in the hope of making fabric and clothing more competitive. There are also grants to encourage textile makers to turn to higher-value products and to adopt new technology.

However, officials have conceded that it has been a huge challenge for Canadian manufacturers to adjust sufficiently to  face up to the competition.

Although China has announced that it would tax textile exports until 2007 - a temporary measure that will be lifted next year - the assumption in Canada is that China will continue to dominate the world's textile trade.

In the past year, textile exports from China to Canada increased by 18 per cent. In 2000, Chinese textiles accounted for 21.5 per cent of Canada's textile imports; by last year, that had increased to a third of all imports.

Each year, the requiem for Huntingdon's textile mills becomes louder and louder.



Canada's mill towns have no  place to hide in free market