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The Reciprocity Treaty

On behalf of Great Britain and its British North American colonies, Governor Elgin signed a reciprocity treaty with the United States on June 5, 1854. This treaty eliminated customs tariffs. The agreement also governed the rights of American and British North American fishermen, raw materials, and agricultural commodities. Although trade between the two countries increased substantially in the years that followed, American politicians -- pressured by the protectionist fervour sweeping the United States -- demanded the treaty be abrogated. In 1865, the American government announced that the treaty would not be renewed, and it ended in 1866.

The treaty was signed at an ideal time for United Canada and the other North American colonies, since Great Britain was phasing out its preferential system. The agreement with the United States gave the business class an outlet for its products. The end of the Reciprocity Treaty was a determining factor in the decision of politicians in United Canada to form a new type of partnership with the other British North American colonies.

Source

Masters, D. C. -- "Reciprocity." -- The 1999 Canadian encyclopedia : world edition. -- Toronto : McClelland & Stewart, 1998.