Crisis and opportunity: The political economy of the stora mill closure controversy in Nova Scotia

Peter Clancy and L. Anders Sandberg

Business Strategy and the Environment, 1995, vol. 4, issue 4, 208-219

Abstract: In 1993, the Swedish multinational Stora Kopparberg announced that its pulp and paper complex at Port Hawkesbury, Nova Scotia, was under review. The firm, which has operated on the site for more than 30 years, raised the possibility that the entire complex could be closed as a result of this review. The decision on the future of the plant has since been postponed, though not before precipitating a prolonged debate on appropriate public responses. The case is complicated by the ‘orphan’ character of the Nova Scotia subsidiary, operating on a small scale and at the periphery of a burgeoning business complex centred increasingly in Europe. Overall it raises important questions about the role of state policy interventions, at both the national and provincial levels in Canada, in shaping the firm's operating environment. The paper situates the Stora subsidiary in a local, national and international context, reviewing a range of factors which shape its strategic commitment to Nova Scotia. It also explores the political initiatives which have been mounted since 1993 to secure a renewed corporate commitment. By tracing the evolution of the Nova Scotia mill, and situating it within Stora's international business strategy, both the closure question and the political prospects for renewal can be more sharply understood.

Date: 1995
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