Canada is officially opposed to the provision, which is included in a recent draft of the Multilateral Agreement on Investment, a treaty now being negotiated by the three dozen members of the Organization for Economic Development and Co-operation.

But there is no guarantee that Canada will win its fight against the Americans and other supporters of a ban on hiring quotas.

According to the draft, which was leaked earlier this year from the secret negotiations under way in Paris, no signatory to the treaty, "may apply national employment quotas relating to the employment of a natural person by an investor."

The MAI treaty, described by some critics as "NAFTA on steroids," is designed to ensure all signatory countries treat all corporations equally, regardless of which country they are based in.

As a result, the Canadian government could not require an Australian company, for example, to set targets for hiring Northerners, aboriginals or any other group.

The deal signed by BHP and the federal and territorial governments last fall clearing the way for Canada's first diamond mine, now under construction 300 kilometres northeast of Yellowknife, includes a series of hiring quotas.

During the first decade of operation, 62 per cent of the employees will be Northern, with the share rising to 72 per cent after that. Eventually, half of the permanent workforce is to be aboriginal.

Sanjeev Chowdhury, a spokesman for the Department of Foreign Affairs and International Trade in Ottawa, said Canada isn't ready to give up the right to impose employment conditions on foreign investors.

He pointed out the treaty is in its "infancy" and that no final agreement is expected until mid-1998. "Canada is opposed to limiting the ability of governments to impose hiring quotas," he said.

But Canada has already lost the right the impose other regulations thanks to the existing North American Free Trade Agreement and the new World Trade Organization. Last month, an international panel ruled Canada's "split-run" magazine regulations that favor Canadian magazines are illegal. And the U.S. Ethyl Corportion is currently suing Canada under NAFTA for a recently passed law that bans the gasoline additive MMT.

In any event, American negotiators and their corporate supporters who favor the anti-quota provision aren't expected to give up easily. According to the Canadian Centre for Policy Alternatives, an Ottawa-based think-tank opposed to the treaty, the U.S. Council for International Business has warned the Clinton administration against Canada's position.

"We will oppose any and all measures to create or even imply binding obligations for governments or business related to environment or labor," said the council in a letter to senior U.S. officials on March 21.

Neither the GNWT's minister of economic development, Stephen Kakfwi, nor other senior government officials were available for comment last week.

But Tony Clarke, president of the Ottawa-based Polaris Institute, which studies democracy and economic issues, called MAI "a surrender to corporate tyranny." "The MAI is designed to establish a whole new set of global rules for investment that will give transnational corporations the unrestricted right to buy, sell, and move their operations whenever and wherever they want around the world, completely free of government intervention or regulation," he said.

Clarke pointed out that 477 out of the Global Fortune 500 corporations have their home base in OECD countries.