Before the First World War, the United States of America was simply a developed country that fell behind other countries, such as Great Britain, France and Germany, with large lands and ample natural resources. However, with the outbreak of World War I, the United States was forced to produce war materials from France and Great Britain and export them to those countries. Therefore, the United States gained a huge amount of money and technical expertise, and thus the country became one of the world's economic powers. As a result, the United States could invest in Canada to obtain raw materials for its secondary industries. However, U.S. investments in the 1920s brought more benefits to the United States itself than to Canada. There are three main reasons for this statement. First, since the subsidiaries were created, Canadian businesses have lost their opportunities. Furthermore, the ultimate goal of U.S. investments in primary industries was to enhance U.S. secondary industries. Finally, the meteoric growth of the Canadian economy in the mid-1920s consequently benefited the United States rather than Canada. For starters, U.S. companies were based in Canada, even though they were controlled from the United States. “US companies built factories to avoid tariffs when importing goods into Canada” (Bell, 2012, para.1). In other words, because U.S. companies could establish many factories in Canada and bypass import tariffs, they could earn double profits through both benefits of setting up subsidiaries. Furthermore, as subsidiaries, partly for automotive companies, prospered, many Canadian automotive industries fell out of control. “It was in these boom years, moreover, that Canadian control of the sector was lost, as the US automakers with whom the Canadians had collaborated...... middle of paper ....../en/article / foreign-investments/ http://www.sciencetech.technomuses.ca/english/about/tra15e.cfm http://www.pulpandpapercanada.com/news/pulp-and-paper-in-canada-its-first- century /1000152489/?&er=NABibliography:Ian Bell. (2012, March 1). The economics of branches. Retrieved from http://www.techvibes.com/blog/the-branch-plant-economy-2012-03-01 Ruben C. Bellan and Gord Mcintosh. (2014, March 27). Foreign investments. Retrieved from http://www.thecanadianencyclopedia.com/en/article/foreign-investment/ Richard White. (n.d.). Manufacturing Automobiles in Canada: A Brief History of the Canadian Automobile Industry: 1900-1980. Retrieved from http://www.sciencetech.technomuses.ca/english/about/tra15e.cfm Mark Kuhiberg. (2003, May 5). PULP AND PAPER IN CANADA: Its first century. Retrieved from http://www.pulpandpapercanada.com/news/pulp-and-paper-in-canada-its-first-century/1000152489/?&er=NA