CANADA-ECONOMICAL DETAILS

Canada has a free-enterprising economy. In times of economic crisis, the government has intervened to accomplish specific social or economic goals. Some time ago the Canadian government had announced a plan, regarding tariff rebates, so as to induce US automobile companies to increase the export of vehicles from their plants in Canada that made US companies increase the scale of their Canadian operations.

To dampen domestic inflation and make imports cheaper on Canadian dollars, the government permitted the dollar to float in the foreign exchange market. For monitoring price guidelines, the Canada Anti-Inflation Act became effective and established an Anti-Inflation board and an Anti-Inflation Appeal tribunal, which became effective on 16 December 1975. This was a part of Government program to limit the growth of public expenditures and public service employment, to allow money supply to increase, and to establish new agencies to deal with energy, food and housing.

There have been various attempts to limit US influence on Corporations and investors. The Foreign Investment Review Act and the National Energy Program aimed at reducing foreign ownership.Petro-Canada the beneficiary of the NEP had become the country’s second largest oil company, ranked by assets. However the conservative government sought to encourage foreign investment and to privatize government owned enterprises. Between 1984 and 1991, the government sold or dissolved many corporations and removed controls on foreign investment.

After more than 10 years of bilateral trade agreement with the US Canada’s economy was growing, unemployment was falling, and inflation was low. However compared to US affluence, nationals were still dissatisfied with the Canadian Economy. The outbreak of Severe Acute Respiratory Syndrome harmed tourism and export in Canada. In May 2003 US and four other countries placed a ban on the import on Canadian beef. In June 2003, the Bank of Canada revised its forecasts for gross domestic product growth downwards. The Canadian dollar appreciated against the American dollar, harmed exports.