Public Enterprises and Canadian Foreign Economic Policy

Abstract

To what extent can public enterprises serve as instruments of policy enabling the federal government to assert a measure of control over Canada's foreign economic relations? This article presents an overview of public enterprises in Canada and highlights the special features of the Canadian political economy which differentiate it from other advanced industrial economies. The activities of the Canada Development Corporation and Canadian National Railways are analyzed in terms of whether they reinforce or undermine the federal government's authority in foreign economic policymaking. It appears that the relative autonomy of public enterprise, from government controls, most pronounced in the case of commercial enterprises operating in competitive markets, fragments decisionmaking. Given that governmental power in Canada is already fragmented due to competitive federalism, and given the expanded activities of provincial public enterprises in recent years, a lack of direction over the subgovernment offederalpublic enterprises compounds the difficulties for Ottawa to conduct a coherent, foreign economic policy.