to the advance in export prices. While our shipments, especially those to Europe, were large, it is nearer the truth to say that excessive export

prices and not excessive exports were mainly responsible for the top-heavy condition of our war and post-war

commerce.

CANAL

ANADA'S international trade history is that of a long struggle against what seemed to be the logic of the situation. The Canadian pioneer struggled bravely to transform a forestclad land into a garden. It was a supreme struggle with nature and nature's intentions. So the Canadian trader who desired to do business with foreign countries had to overlook geographical considerations and take his wares long distances overseas. If he could have had unimpeded access to the United States market and had that market been able to absorb his surpluses, his task would have been easy. But politics, tariffs and similarity of products decreed that it must be otherwise.

In the first twenty years of Confederation, 1868 to 1887, Canada exported goods to the value of $1,460,000,000 of which $665,000,000 went to the United States and the remainder to the rest of the world. Of her total sales, only 45 per cent went to the large neighboring market. The remainder, or 55 per cent, had to be sent overseas. In those days the distances to foreign markets were farther than today, because the ships that carried the goods were smaller and slower.

In the next twenty years, 1888 to 1907, the same tendency is evident. There had been talk of "reciprocity" with the United States, but the McKinley Tariff of 1890 dealt that idea a staggering blow. In 1897, the Cana

In this period, the sales to the United States fell to 38 per cent and those to the rest of the world grew to 62 per cent. Canada was definitely launched on a non-continental policy. The world, not the North American continent, was to be her chief market.

During the following eleven years, 1908 to 1918, a great war occurred and the shipments of munitions to Great Britain made the tendency even more marked. The unusual circumstances make the figures interesting, but prevent the drawing of any definite conclusions. They are:

Since these figures were compiled, the government has undertaken to build and maintain a Canadian merchant marine which will increase the percentage which her own tonnage bears to the total tonnage entering her ports. The policy adopted is quite different from the shipping policy of the United States, though the aim is akin. The Canadian Government Mercantile Marine, an incorporated company in which the Government is the sole stockholder, has been projected with a definite plan for the creation of a fleet of seventy vessels. About forty of these are already in commission. Regular services have been established with England, the West Indies, Brazil and Australasia. At present all traffic is confined to freight, although some vessels on the West Indian route are being reconditioned to admit of the carrying of a limited number of passengers. The general policy is to use these boats as auxiliary to existing privately-owned

lines and to develop such new routes as seem desirable in the interests of Canada's export trade.

CANADIAN IMPORTS

Naturally Canada's purchases abroad have been affected by the across-thesea trading policy which necessity forced her to adopt. When vessels go abroad, they must have return cargoes. Canada attempted to secure these return cargoes by giving British manufacturers a preference in respect of customs duties. This was done in 1897. Ten years later, a treaty was made with France whereby French goods were given a tariff which was "intermediate" between the preferential tariff on British goods and the general tariff which applied to other countries. Under this French Tariff certain favored nations were also entitled to these "intermediate" rates. Three years later, 1910, a similar arrangement was made whereby the intermediate tariff was extended in part to Belgium, the Netherlands and Italy. In 1913, a preferential arrangement was made with the British West Indies. This was further extended in 1920.

Between 1888 and 1907, Canada imported goods to the value of $1,744,000,000 from the United States out of a total of $3,160,000,000, or 55 per cent. In the eleven years, 1908 to 1919, Canada's purchases from the United States were valued at $4,898,000,000 out of a total of $6,959,000,000, or 70 per cent.

Of Canada's total imports in 1914, the United States supplied goods to the value of $395,565,000, as compared with a total from all countries of $618,457,000, or 64 per cent. Similarly, in 1920 (year ending March 31), the United States sold Canada $801,605,000 out of the total Canadian imports of $1,064,516,000, or 80 per cent. This figure will probably never be exceeded,

as Europe is rapidly regaining that portion of Canadian trade which was lost during the Great War.

RECENT TENDENCIES

Canada had been five years in the war and her imports had been greatly restricted. When peace came at the end of 1918, people felt free to buy goods that they had long wanted or now required in order to develop their natural industries. Imports at once began to show a considerable expansion in certain lines of staples and luxuries, accompanied by a steady decline in purchases of raw materials for war products. The total figures do not indicate these changes, but an analysis does. Imports of textile products, for example, grew from $154,000,000 in 1917-1918 to $234,000,000 in 1919-1920. Metals and their products, non-metallic minerals and their products showed a decline. Vegetable products made a decided increase from $146,000,000 to $237,000,000. The United States, being the one country with unlimited goods for export, got the benefit of this increased demand for manufactured goods.

The latest twelve-month returns available for Canada's purchases by countries show some remarkable changes in the post-war period:

of supplying 80 per cent of Canadian purchases, it will return to its normal position of about 60 per cent. The United Kingdom, France, Belgium, Holland and Italy are sure to regain much of their trade with Canada which was lost during the war.

During the war period Canada, for the first time in her history, piled up an excess of exports over imports. For the five years ending March 31, 1920, that favorable balance of trade amounted to $1,718,586,000. During 1920, however, imports rose faster than exports, and Canada finished the year with a small unfavorable balance.

CANADA'S FUTURE EXPORTS

Canada has become a great foreign trader. Its imports per capita are nearly three times as large as those of the United States, while its exports are nearly double per capita. The explanation of this would require much space to discuss. Its enormous natural resources are comparatively easy of access, though its territories are broad. It has the greatest railway mileage in the world for its population. As has been indicated, its shipping is proportionately large and its people have been accustomed through half a century to foreign trading. Because it has much to sell, because it has the

CANADIAN IMPORTS BY COUNTRIES
Twelve Months Ending September