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How to Write a Foreign Investment Report Without Even Trying

In the seventies, foreign investment was a major preoccupation of the Government of Canada and of the provincial governments. We were concerned about foreign investors and corporations controlling our industries and resources but at the same time we believed that we needed large amounts of investment for our economies. How to balance one with the other was the subject of some very fine studies and official governmental enquiries, not the least was the Gordon Report, 1967 of Walter Gordon Canadian Finance Minister, and The Gray Report, 1972 of Herb Gray, Canadian Consumer and Corporate Affairs Minister.

On the day the Gray Report was made public, I leaned over to Robert Bourassa as we sat down in the National Assembly for the question period and said he should be prepared for a question on the Report and that we ourselves should be doing a study of foreign investment in Quebec. Sure enough, he was questioned and Bourassa replied, looking at me, that the Minister of Financial Institutions already had the matter in hand. Thus began an inter-ministerial task force which produced its report - “A Quebec Policy on Foreign Investment”, colloquially known as the Tetley Report.

Initially, I had no budget or experts but Bourassa gave us the services of a very competent and dedicated economist André Marier who was economic adviser to the Cabinet. Marier became secretary to the task force, chief researcher and principal drafter. Civil servants from such ministries as Industry and Commerce, Health and Social Services, and Cultural Affairs attended the almost twice-monthly meetings for nearly two years. One minister - Kevin Drummond, Minister of Lands and Forests, also attended religiously, making significant contributions.

The Report in essence welcomed foreign investment but expected the investors to integrate as much as possible into Quebec society and culture. Government agencies were to be helpful in this integration and natural resources were to be protected. The table of contents of the Report is attached.

The first report contained recommendations and when I deposited it in Cabinet in 1974, there were two reactions. First the genuine fear that some of the recommendations went too far or at least might shock the business community and secondly a feeling of jealousy on the part of some ministers that they had not headed up the task force. The Report was blocked and after ministerial meetings and hard negotiations it was slightly revised, but stripped of its specific recommendations, but not conclusions.

It should be understood that feelings of competition, rivalry, power and even grandeur of some ministers and particularly their staffs is commonplace in most governments, especially amongst ministers, who may have ambitions to take over when the leader retires. Front seats in the House and being titularies of the various cabinet super ministries, which became known as “Jumbo ministries” and which Bourassa created to his regret, did not always aid ministerial cooperation. Nevertheless, in general we got along very, very well, although when I got up in the National Assembly to present the Report, which I had produced and bore my name and introductory comments, another minister wanted to make the presentation. Such was his hubris that he leant over three times to insist that he present the Report. Eventually the speaker saw me and I made the deposit.

The Report reads very well today and is still the subject of considerable favourable comment in academic, governmental and economic studies. It received one of its greatest accolades when René Lévesque after being elected in November 15, 1976 went to New York to explain the foreign investment policy of Quebec to the American bond market which had invested in much of Quebec’s public debt. His trip, billed as that of the first separatist Quebec Prime Minister, was filled with considerable interest and apprehension. Lévesque spoke drawing from my report as the papers reported in the press. In fact the week before, the Le Devoir headline of January 21, 1977 read: “À New York, Lévesque s’inspirera du rapport Tetley.”

There was no apprehension in New York and the Report is still the bench mark for foreign investment in Quebec; no government, whether Liberal or Parti Québécois having since found it necessary to do another such general study. I must add with considerable appreciation that the Report would not have been possible without the support and dedication of Robert Bourassa, Kevin Drummond and André Marier.

William Tetley
Professor
Faculty of Law McGill University
514 398-6619 (office)
514 733-8049 (home)
E-mail: william [dot] tetley [at] mcgill [dot] ca (William Tetley)
Website: www.mcgill.ca/maritimelaw/

(William Tetley, C.M., Q.C., was a Liberal Member of the Quebec National Assembly and Minister in the Bourassa government from 1970-1976. He is presently a professor at McGill Law Faculty and Counsel to Langlois Kronström Desjardins.)

 

A Québec policy on foreign investment

 

Government of Québec
Executive Council

 

Report of the Interdepartmental Task Force on Foreign Investment

 

TABLE OF CONTENTS

 

Introduction...................................................................5

Contents.......................................................................9

 

PART ONE: Canadian policies and the consequences of foreign initiatives for the Quebec economy ...............................................................................11

Chapter I − The development of Canadian Policies on foreign investment....................................................................13

Chapter II − The phenomenon of foreign investment in Québec........................................................................25

 

PART TWO: Reorientation of Québec policies on foreign investment....................................................................53

Chapter I − Use of the Québec government’s regulatory power as a means of integrating foreign firms.........................................................................57

Chapter II − Redefinition of government industrial policies in terms of industrial integration and innovation....................................................................71

 

PART THREE: Specific action respecting sectors considered vital for Québec.. ..............................................................................107

Chapter I − The vital character of the cultural sector for Québec ..............................................................................111

Chapter II − Natural resources, mainspring of the development of Québec’s economy ..............................................................................127

Chapter III − Specific measures respecting financial institutions..................................................................141

Chapter IV − The key role of public utilities, participation of Quebeckers and control of foreign initiatives.................................................................157

APPENDIXES..................................................................173

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