ABSTRACT

The year 1972 was an important turning point in the evolution of Canadian policy on direct foreign investment. For the first time a comprehensive cabinet-level report was published on the subject. While not an official policy statement, the Gray Report was a clearer indication of government thinking than the two chief previous efforts, the 1958 Gordon Report and the 1968 Watkins Report. When Herb Gray, Minister of National Revenue, was charged with preparing the study of foreign investment in 1970, Canadians hoped that the outcome would be a firm statement of government policy which would set a clear course for official action for some years to come. This chapter explains three clusters of elements bearing on the evolution of national policy on foreign investment: attitudes toward foreign business, national decision-making processes, and industrial strategy. It discusses the specific elements of policy on foreign investments. The chapter describes the history of foreign investment in Canada and national policy concerning it.