Abstract

The current challenges faced by defence firms within the Western industrialized nations take on a unique form in the case of Canada, largely as a result of the evolution of Canada’s defence industry since the mid-1950s. With the signing of the Defence Production Sharing Agreement, and symbolized by the cancelation of the Avro ARROW project1, Canadian defence firms have effectively been part of the American defence market. As a result, the fundamental challenge faced by Canada’s defence firms today concerns the impact of changes in the American defence market through the new approach to defence spending being ushered in by the end of the Cold War and the Clinton Adminstration. These changes, and the response of the Canadian government and defence industry to them, will largely dictate the future viability of the defence firm in Canada.

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