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Reciprocity was a free trade deal between the United States and Canada. (Reciprocity is when both sides give and receive.) The deal reduced import duties and tariffs on certain goods traded between the two countries. It was in effect from 1854 to 1866. It was at times a source of great controversy in both countries. It was replaced in 1878 by the National Policy. It was a more protectionist policy. It imposed tariffs on imported goods. This shielded manufacturers in Canada from US competition. A more limited reciprocity deal was reached in 1935. It ended in 1948 after both countries signed the General Agreement on Tariffs and Trade (GATT).
This article is a plain-language summary of Reciprocity. If you would like to read about this topic in more depth, please see our full-length entry: Reciprocity.
The First Treaty (1854–66)
British diplomats had tried before 1852 to reach a free trade deal with the US, without success. Its first major supporter in Upper Canada was William Merritt.
The movement toward free trade began between 1846 and 1850. It became a main issue in Canada West (now Ontario) and the Maritime colonies, especially New Brunswick. It was started by a dispute over the rights of US fishermen in the waters of British North America (BNA). Both governments wanted to settle the dispute.
The Reciprocity Treaty was signed on 6 June 1854. It was passed by the US Congress in August. The deal was to be in force for 10 years. After that, it could be ended by either side with one year’s notice.
The deal gave US fishermen access to the BNA’s Atlantic coastal fisheries. It also allowed BNA fishermen to fish US coastal waters north of 36 degrees N latitude. The deal allowed for the free trade of many natural resources.
Trade between the US and the colonies increased sharply after 1854. But this was mainly due to other factors. Chief among them were the railway boom in Canada and the effects of the American Civil War (1861–65) in the US.
Cancellation and Confederation
At first, the treaty was popular in both countries. But it fell out of favour due to several political and economic factors. Many people in both countries feared that it would lead the US to absorb the BNA colonies. Many in Canada were afraid of being displaced by the more economically powerful US. Many in the US feared that it would increase the influence of the Northern states.
During the Civil War, Britain quietly helped the Southern states. At the end of the war, Northern politicians were angry at Britain. They sought an end to free trade with the BNA colonies. The US cancelled the treaty on 17 March 1866.
The end of the deal strengthened the idea of a Confederation of the BNA colonies. A larger Canadian market would improve trade for each colony.
New Attempts at Reciprocity
After Confederation, some in Canada wanted to renew free trade with the US. John A. Macdonald, George Brown, Charles Tupper and others made “pilgrimages” to Washington, without success. In 1871, Macdonald failed to have a large measure of free trade included in the Treaty of Washington.
In the 1880s, a wide-ranging free trade deal was proposed by Canadian businessmen. It was called “commercial union” or “unrestricted reciprocity.” But these proposals were rejected in the 1891 Canadian election. In 1897, Liberal Prime Minister Sir Wilfrid Laurier announced: “There will be no more pilgrimages to Washington.”
The last major attempt at free trade was made by the Laurier government in 1911. This deal allowed the free trade of natural resources. It also reduced the duties on many other products. The agreement was passed by the US Congress. But it was rejected by Canadians. The Liberals were voted out of power in the election on 21 September 1911.
End of Reciprocity
After 1911, reciprocity played a lesser role in Canada-US relations. In 1935, the Mackenzie King government signed a trade deal with the US. But it removed far fewer trade barriers than the deal of 1854.
In 1938, a new deal was signed. It was much more comprehensive. But it was ended in 1948. Both countries instead signed the General Agreement on Tariffs and Trade (GATT).
Free Trade Revival
In the 1980s, the Progressive Conservative government of Brian Mulroney set up the Canada-US Free Trade Agreement (FTA). It was signed in 1988. Like the earlier free trade deals, it took away many trade barriers between the two countries. It was replaced in 1994 by the North American Free Trade Agreement. It was a free trade deal between Canada, the US and Mexico. That deal was replaced by the Canada-United States-Mexico Agreement (CUSMA) in 2020.
(See also Anti-Reciprocity Movement.)
