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Canadians Drawn By Low Prices, Strong Dollar Flood U.S. Stores

December 31, 1989

NIAGARA FALLS, N.Y. (AP) _ Canadian shoppers have made this holiday season jolly for U.S. retailers, but some residents are feeling a lack of goodwill toward fellow shoppers from across the border.

Low U.S. prices and a comparatively strong Canadian dollar have caused Canadians to throng grocery stores, liquor marts and factory outlets throughout this border city.

″The prices - check it out,″ said Manny Hilario, 23, who drove 100 miles from Brampton, Ontario, to shop at the Factory Outlet Mall one recent Saturday. Outside, in an overflowing parking lot, Ontario plates outnumbered New York plates more than three to one.

The crowded lots, long checkout lines and delays entering Canada on the area’s three international bridges have caused tempers to rise at times.

A group of six Niagara Falls residents announced recently they were forming a group called ″People Against Canadian Shoppers″ to press local merchants to deal with the problems.

″We have nothing against them (Canadians) personally, but we do think something could be done to improve the situation for everyone,″ Steve Hughes, a spokesman for the group, told The Niagara Gazette.

Hughes said his group is circulating petitions blaming Canadians for everything from litter and rudeness to unsafely transporting gasoline across the border in extra tanks.

That effort, in turn, has prompted U.S. business and tourism officials to hasten to assure Canadians that they are still welcome.

″It’s easy to blow this out of proportion and make out that there’s a major war going on,″ said Ray Wigle, spokesman for the Niagara Falls Convention and Visitors Bureau.

The convention and visitors bureau and the Niagara Falls Area Chamber of Commerce have urged businesses to clean up the trash and expand checkouts. Local governments have been asked to increase traffic control in order to reduce the complaints.

Local Canada Customs officials have asked the agency that operates the international bridges to expand the customs facilities and are trying to persuade Ottawa to allocate more staff.

Same-day shopping traffic across the Rainbow and Whirlpool bridges has increased by almost 60 percent over the past four years, and at the Lewiston- Queenston bridge, the main route to major Canadian cities such as Hamilton and Toronto, traffic is up 107 percent over that period, said John Johnston, district manager for Canada Customs operations in Niagara Falls.

Theories abound over why the number of shoppers has multiplied, though the year-old U.S.-Canada free trade pact isn’t considered a direct cause. The agreement has reduced wholesale tariffs on several categories of merchandise but has not yet affected the duties paid by individual shoppers at the border.

Still, free trade may have subtly boosted cross-border shopping by helping to strengthen the Canadian dollar. The Canadian dollar trades at about 85 U.S. cents these days after falling as low as 70 cents earlier in the decade.

Niagara Falls, N.Y., also has a built-in price advantage because western New York is one of the cheaper regions of the United States while Niagara Falls, Ontario, is an extension of the pricey Toronto metropolitan area, said Wigle.

Price is not the only attraction of the United States, some Canadian shoppers said.

″In groceries, anything new they come out with (in the U.S.) is in Canada the year after,″ said Lisa Morrice of Hamilton, Ontario.

″You just don’t have the choices (in Canada),″ agreed a Toronto woman who declined to give her name. ″You see different things down here.″

U.S. grocery chains began advertising heavily across the border in the past few months after seeing the stronger dollar and the increased willingness of Canadians to cross the bridges.

″Their money is worth a lot more than it was two years ago,″ said Ralph Meranto, manager of a local Tops supermarket. ″It wasn’t even worthwhile before.″

Canadian merchants say they can’t compete with U.S. prices, but are not calling for stronger government action to protect them.

Turkeys that cost 69 cents a pound in the United States sell for the equivalent of $1.28 to $1.49 a pound in Canada, said Justin Sauve, manager of Hy and Zel’s Supermarket in Niagara Falls, Ontario.

″A lot of people I know buy a case of beer for 10 bucks (in the U.S.) and over here it’s $22 or $23,″ Sauve said. ″People go over there to gas up and they go to the stores while they’re there.″

Canada, unlike the United States, has no duty-free allowance for shoppers who have been out of the country less than 24 hours. Sauve said a lot of Canadians are escaping the duty and federal sales tax, which can add up to 19.8 percent to the cost of a purchase, but declined to fault customs officials for letting them through.

″If you take everybody who you could pull over, you’d be pulling everybody over,″ he said. ″You’d be there all day pulling them over.″

Johnston, the customs manager, said his agency’s penetration rate was ″reasonable″ given the need to keep traffic flowing.

″When we have to take enforcement action, it tends to slow things down,″ he said.

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