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After the discovery of Newfoundland by explorer John Cabot in 1497, European fishermen, mainly Bretons, Basques, and Portuguese participated in cod fishing close to Labrador and Newfoundland Island, and in the Gulf of St.Lawrence.
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Even though it would be abandoned 1 year later, it remained as a trading post for the Amerindians for the fur trade.
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The King of France granted a monopoly in the fur trade to merchant companies. The French formed alliances with several Aboriginal nations in order to take advantage of their vast trade network.
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The Five-Nation Iroquois started running out of fur and fought against the Hurons-Wendats, their main competitors and destroyed all the villages belonging to the Hurons-Wendats.
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- Colonizing states should export the greatest possible quantity of goods in order to become wealthy from profits generated by their exports.
- The mother countries relied on their colonies for the raw materials necessary for the production of manufactured goods, which they could then sell to other states.
- The colonies thus supplied the mother country's factories, and were, additionally, a market for the sale of finished products.
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Jean Talon tried to make the colony economically independent through self-production Talon imported domesticated animals from France, Agriculture became diversified and he also founded a naval shipyard near Québec City.
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The company built trading posts throughout the entire region. Fur trade in this region was the subject of a bitter rivalry between France and Great Britain and resulted in a series of land and sea battles.
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The French organized commercial trades between France, New France and the West Indies. Boats cannot leave a port empty handed. They must be full of products or resources. Boats leaving New France and the West Indies must transport natural resources to France. Boats leaving France for New France of the West Indies must transport manufactured goods.
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Diversifying the economy
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A packed dirt road of 7 metres wide connected Montreal to Quebec along the north shore allowing for transportation and communication for the seigneuries and inhabitants.
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The Quebec Act lead to major changes for the fur trade. The Scottish, English and American merchants had greater financial means and increased fur supplies
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Upon the political creation of the United States, the entire region south of the Great Lakes was lost to the Montreal fur trade merchants who joined forces and created the Northwest Company.
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The Hudson Bay Company competed against the Northwest Company, spending large amounts of money to build trading posts while the demand for fur declined. Finally the two companies merged.
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The increase in demand from Great Britain attracted British investors who brought the necessary capital to develop this industry in Canada. Commercial ships increased from 100 to 661.
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The beginning of the 19th century marked the transformation of agriculture and the beginning of industrialization in Quebec.
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French Emperor Napoleon 1 tried to conquer all of Europe and created a blockade against Great Britain forcing them to turn to Canada for timber to build their ships.
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The Lachine Canal on the St. Lawrence River quickly created a major industrial zone in Montreal.
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Much like the canal systems, railroad construction allowed for industrialization to increase and the economy to grow.
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A free trade agreement between Canada and the United States.
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The colonies of New Brunswick and Nova Scotia joined the Canadian federation on the promise to establish a railroad connecting them to Quebec and Ontario's railroad network.
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The federal government created the Bank of Canada which gave it better control over the economy.
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When the war started the Canadian economy made a spectacular recovery. Canada furnished its allies with supplies creating full employment. Consumption was low because products were rationed for the war.
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A strong demographic growth created savings, the employment rate was high and wages increased. The phenomenon known as Mass Consumption was created.
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The energy crisis brought about an increase in the price of oil, and inflation. Unemployment also increased. This situation eventually lead to a recession in 1981.
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Canada signed a free trade agreement with the United States and Mexico, permitting the free circulation of goods between these countries. This created growth in the economy.
