Introduction

The main aim of this book is to examine the bilateral economic relations between Canada and the United Kingdom (UK) in the context of a changing global economy. The context of Canada—UK bilateral economic relations has changed radically over the past two decades. The UK’s entry to the European Community (EC, now the European Union) in 1973 and the creation of the North American Free Trade Agreement have accelerated economic integration on both sides of the Atlantic. No analysis of bilateral relations can be undertaken without an understanding of Canada’s relationships with the USA and the UK’s with its European partners. The regulatory environment, too, reflects these changes. In the more than 20 years since the UK joined the EC, capital has become more internationally mobile in the form of foreign direct investment (FDI) under the control of individual multinational enterprises (MNEs). The increasing ability of multinational firms to switch the location of their production and service facilities is an issue which all national governments must be aware of. Within free trade areas this mobility can be more pronounced as multinationals seek the optimum location within (as well as between) their economic space.