The Conservative government's decision to block the sale of a Canadian space technology company to a U.S. firm doesn't mean a new era of economic nationalism, says Industry Minister Jim Prentice.
"The decision that's been made is an important part of standing up for Canada, and that ... is what we do as a government," he told CTV's Question Period on Sunday.
"This decision ... reflects pretty unique circumstances."
Prentice said the key reason for blocking the sale of MacDonald, Dettwiler and Associates (MDA) to Alliant Techsystems Inc. (ATK) is the Radarsat-2 satellite.
It's an Earth observation satellite built in partnership with the Canadian government, he said.
Radarsat-2 has national sovereignty implications as it can allow the monitoring of surface ships sailing in the Arctic.
The federal government directed $445 million in contracts to MDA to help fund the development of the satellite.
Selling MDA to a foreign firm would have made the satellite subject to another country's legal system, Prentice said.
However, under Investment Canada, Prentice's decision is only preliminary. There will be a 30-day review period.
Prentice said he will be meeting with ATK officials to discuss the matter. Former U.S. ambassador to Canada Paul Cellucci has suggested a compromise could yet be found.
MDA has fretted that if the sale is cancelled, the firm won't be able to bid on U.S. defence contracts. Employees have noted that 81 per cent of the world's space spending is done by the United States.
Prentice said the Conservative government plans to "continue to pursue excellence in space," and that MDA will be "an important part of that future."
MDA is also working on a next-generation satellite system called Constellation that will cost up to $300 million to develop.
The decision to offer further funding to the Constellation project is under review at the Canadian Space Agency, he said.
