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Period: 1500 to
Fur Trade as the Main Economic Activity
Starting with the fur trade around 1500 between the Amerindians and European Fishermen, the fur trade blossomed with the colonization of New France; for around 200 years it was the main economic activity. The fur trade boosted New France's economy, help develop regions such as Quebec and attracted immigrants from France to come and participate. -
Founding of Quebec
Explorer, Samuel de Champlain, founded Quebec in order to facilitate fur trade with the Amerindians. This was used as a major trading post and therefore helped to boost the economy. -
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Mercantilism
The policy of Mercantilism was introduced in 1608. It benefited the Mother Country, France. Any natural resources had to be given to France who would turn the resources into manufactured products and sell them back to the colonies. In this situation, only France would benefit. The basis of Mercantilism was to bring in a lot of wealth and money to the mother country via the colonies natural resources. It made New France entirely dependant on France and didn't allow them to develop their economy. -
Creation of One Hundred Associates
Founded by Cardinal Richelieu, One Hundred Associates also known as Compagnie de la Nouvelle-France was the first charted company to have monopoly over the fur trade. They were financed by 100 French shareholders who invested into the company. They decided the price of the pelts and how many would go to Europe. -
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Jean Talon Attempts to Diversify the Economy
French intendant Jean Talon tried wanted to diversify the economy of New France as well as make it more independent from France. He tried to do this through self-production: imported seeds to be able to export agricultural surplus, imported domesticated animals to breed, initiated the mining industry, built a brewery, as well as founded a naval ship yard to be used to export the colony's surplus to other French colonies. In doing this, New France had to rely less on France. -
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Crisis in Fur Trade
In the 1690's fur was no longer demand in Europe as fur-related fashion was no longer a trend. This meant that since the demand for beaver pelts decrease and fur trading remained intense, a pile up of pelts began to grow in the warehouses in France. The King of France ordered a slow down of the fur trade to try and solve the issue. From the 1690's onward, fur trade decreased more and more. -
Triangular Trade
The French organized commercial trades between France, New France and the West Indies. This allowed France to get rich by taking the natural resources from its colonies, making them into manufactured goods in France and reselling the products back to their colonies. Three main principles: 1- boats can't leave empty handed, 2- boats leaving the colonies must carry natural resources to bring back to France, 3- boats leaving France must carry manufactured goods to sell to the colonies. -
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Competition between the Northwest Company and Hudson's Bay Company
The Northwest Company, founded in 1783, was a new fur trading company. It competed with Hudson's Bay Company to attract Amerindians to their trading posts. This created great competition. The rivalry cost both companies lots of money as they continued to build bigger and better trading posts as the demand for fur declined. In 1821, the two companies, by encouragement of the British Government, fused together under the name of the Hudson't Bay Company. -
Napoleon the First's Continental Embargo
In 1806, France and Great Britain were at war. To prevent the British from getting their resources from Europe, Napoleon the First, France's Emperor at the time, forced a continental embargo blocking the British from supplies in Europe; they now needed a new supplier for forest products and turned to North America for timber supplies. Quebec's economy thrived from British investments and buyers; timber trade became the main economic activity in 1810 and was controlled by Britain. -
Timber Trade becomes the Main Economic Activity
With the introduction of the timer trade industry by Gilles Hocquart around 1663, eventually the timer trade by passed the fur trade and became Quebec's main economic activity in 1810. This brought around new jobs, the development of new regions and an increase in the influence of the British merchant class. It brought in capital from British investors and boosted the economy as Quebec became Britains main timber supplier after the 1806 Continental Blockade in Europe. -
Corn Laws are Adopted
Great Britain implemented a series of laws in 1815 called the Corn Laws. These guaranteed preferential tariffs on the British market to the colonies' grain merchants. They were put in place to protect British agriculture from outside competition. This benefited the famers in Lower Canada. The laws were abolished in 1846 at the end of Mercantilism. -
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Protectionism
Once New France became a British colony Mercantilism remained effective till the mid-19th when it was replaced with Protectionism. It was an economic policy put in place by the Government to protect the economy of colony and empire from foreign competition. This boosted the colony's economy. -
Founding of the Bank of Montreal
The Bank of Montreal was founded in 1817 as a result of the increase and success of the timber trade in Quebec. The founding of the bank represents progress in Quebec's economy because some of the population now had enough money to save and invest and more money was coming in from British investors and buyers of timer supplies. -
Lachine Canal
As a result of the rapid increase in production of merchandize due to the industrialization of Canada, new means of transportation were needed to facilitate the transport of goods and to reduce production costs. To facilitate transport on water, the Lachine Canal was built in Montreal in 1825 funded by taxes and public loans (government money). This allowed direct sailing between Montreal and the USA via the Great Lakes. It made transport and trade much easier. -
Agricultural difficulties leading to an Economic Crisis
In Lower Canada, the soil became infertile and agriculture production became difficult. Lower Canada was no longer able to supply Great Britain with wheat and other agricultural products which lead to an economic crisis in Lower Canada. As of 1830, Upper Canada became the main supplier for Great Britain. -
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First Phase of Industrialization
Artisans were being replaced by manufactures in big factories. Machinery was being developed making the division of labour much easier and increasing productivity as well as reducing production costs and time. At this time industries were focused in the major cities. Food, shoes and leather, textile, tobacco, mining, pulp and paper were the main industries as well as an increase in dairy farming. Attracted immigrants and farmers leading to urbanization due to a rise in the cities populations. -
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Reciprocity Treaty
With the abandonment of Protectionism in 1846 and the adoption of free trade the colony had to rely on Great Britain for exports. They needed a new market; they turned to the United States. In 1854, the Reciprocity Treaty was signed. Exports between the two countries boosted during the years that the Treaty was active compared to the years before. In 1865, the treaty wasn't renewed. -
Introduction of John A. MacDonald's National Policy
In 1878, Prime Minister John A. MacDonald wanted to end Canada's economic crisis. He introduced a national policy which will impose custom tariffs on imported manufactured goods; this would increase the consumption of Canadian-made goods as they were cheaper for Canadians to buy. With high taxes on foreign products he was able to finance the construction of railways which were able to transport goods and immigrants to the West, populating new regions and increasing the market. -
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Second Phase of Industrialization
This was a phase of high technology and advancement. It was characterized by the exploitation of natural resources: aluminum, minerals, pulp and paper. The development of hydroelectricity and oil was also a big part. There was also an expansion and development of new regions because industries were located near the natural resources. The majority of investors came from Great Britain and the United States. This increase in production and investments brought wealth to the Canadian economy. -
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World War One
Canada's participation in World War One was mainly as a supplier. We supplied Great Britain with guns, uniforms and bombs made in our factories since we weren't under attack. This stimulated the Canadian economy because we became one of the major suppliers for all the allied troops in Europe. It also created a lot of jobs. -
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Great Depression
In 1929, the New York Stock Market crashed. After the 1920's, a decline in production lead to bankruptcies and unemployment lead to the crash. 25% of workers were unemployed. This affected Canada because we were partners with the United States and most of our investments came from the US. The Governments attempted, over-time, to implement measures to help the population and created new jobs and laws. The Federal and Provincial Government was involved as well as the Church. -
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World War Two
The start of World War Two ended The Great Depression in North America. Much like in WWI, since the war was in Europe, Canada was able to produce and supply allied troops with foodstuffs and military equipment. This create many jobs for men and women in factories. Also many men went of to fight in the war giving them a job. The unemployment rate declined greatly. The was also an increase in agricultural production to feed the troops and those in was devastated Europe. -
Nationalization of Hydro-Electricity
In 1962 the Quebec Government bought out most private electricity companies and fused them under the same name: Hydro-Quebec. They wanted to nationalize the production and distribution of hydro-electricity. The Government invested a lot of money into hydro such as the building of the Manicouagan-Outardes Complex and the building of many dams such as the Daniel-Johnson Dam. New regions were also developed since factories were now built near the natural resource: dams built near water. -
Free Trade Agreement with USA and Canada
January 1st, 1989 an agreement between Canada and the United States came into effect. The Canada-United States Free Trade Agreement (CUSFTA) eliminated almost all customs duties between Canada and the United States facilitating trade between countries. -
North American Free Trade Agreement (NAFTA)
The treaty known as the Canadian-United States Free Trade Agreement of 1989 was renegotiated in 1994. It now included Mexico as well as Canada and the United States. It was named the North American Free Trade Agreement (NAFTA) and allowed free trade between the three countries.
