Timber, Wheat & Reciprocity Economic Development in British North America, 1800-1866

Emergence of New Staples Post-1800: new staples replace fur as major exports Timber & Wheat become valuable colonial exports Sold in "protected" British markets

The Timber Trade Large demand for timber in Britain - shipbuilding (British Navy) Britain's supply exhausted by 1800 Britain had relied on 13 Colonies and northern Europe (Russia & Sweden) for timber American Revolution led to loss of 13 Colonies' timber Napoleonic Wars (1803-15) cut off access to European timber

Birth of a New Staple British North American colonies (esp. New Brunswick & Upper Canada) had abundant forests Colonial timber trade develops after 1800 Colonial timber imported into Britain without duties (preferential trade status) Duties placed on European timber, making it more expensive

Impact of Timber Trade Timber boom in New Brunswick & Upper Canada Shipbuilding becomes a "secondary" industry in Atlantic colonies (wooden sailing ships) Nova Scotia experiences "golden age of sail" - era of prosperity based on shipbuilding and trade Timber ships provide cheap transportation to BNA for immigrants after 1815

Decline of Timber Trade Late 19th c.: Development of iron and steel vessels powered by steam - Nova Scotian prosperity declines Lower demand for timber creates need for new staples

Wheat: An Agricultural Staple Napoleonic Wars (1803-15) cut off Britain's access to European grain Britain seeks a secure wheat and grain supply in British North America Grain and flour production expands rapidly, esp. in Upper Canada

Wheat: An Agricultural Staple 1820: Corn Laws (British law) impose duties on grain products entering Britain from outside the Empire Colonial grain, like timber, enjoys preferential trade status (imported without duty)

Economic Impact of Wheat Basis of Upper Canada's economy Significant population growth Development of new settlements Improved transportation: roads and canals built to move grain to markets Secondary industry: flour mills built to process grain

End of Preferential Trade Status Preferential trade status for colonial products makes European staples more expensive 1840s: British industry producing large quantities of manufactured goods British manufacturers want to sell their products in European markets Campaign to eliminate preferential trade status for colonial staples

End of Preferential Trade Status 1846: British government repeals Corn Laws End of preferential trade status for colonial staples Britain adopts policy of "free trade" Necessary staples imported from Europe in exchange for British manufactured goods

Impact on British North America End of preferential trade status means loss of British markets for colonial wheat and timber Trans-Atlantic shipping made BNA staples more costly than European staples Economic depression threatens to destroy colonial economies 1849: Montreal merchants issue Annexation Manifesto, suggesting that Canada join the United States as a solution!

Securing A New Market BNA colonies look to the United States to replace to lost British markets British Governor-General Lord Elgin opens negotiations with the United States Result - Reciprocity Treaty (1854)

Reciprocity Treaty of 1854 Free trade in natural resources (staples) between BNA and the US American fishermen given access to North Atlantic fishery Shared access to Great Lakes & St. Lawrence River 10-year agreement Could be ended by either party after two years' notice

Effects of Reciprocity Upper Canada exports timber and wheat to US Atlantic colonies export fish, timber and coal to US Trade increases during American Civil War (1861-65) - shortages, greater demand for resources Result - Economic prosperity returns

BNA - US Trade (1850-70)

End of Reciprocity (1866) 1864: Americans give notice to end Reciprocity in 1866 Reasons: A) Poor relations with Britain during the American Civil War B) Some Americans believe ending Reciprocity would force BNA colonies to join the United States Loss of guaranteed American market creates another economic crisis in BNA

An Uncertain Economic Future How can the BNA colonies best secure their economic future? Some form of political union (Confederation) becomes one possible solution