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The General Agreement on Tariffs and Trade (GATT) was an international trade agreement. It was signed by 23 nations, including Canada, in 1947 and came into effect on 1 January 1948. It was refined over eight rounds of negotiations, which led to the creation of the World Trade Organization (WTO). It replaced the GATT on 1 January 1995. The GATT was focused on trade in goods. It aimed to liberalize trade by reducing tariffs and removing quotas among member countries. Each member of the GATT was expected to open its markets equally to other member nations, removing trade discrimination. The agreements negotiated through GATT reduced average tariffs on industrial goods from 40 per cent (1947) to less than five per cent (1993). It was an early step towards economic globalization.

International trade is the buying and selling of goods and services between members of different countries. This exchange has been a key part of the Canadian economy since the first settlers came. Canadian settlers depended on exports of resources such as timber and grain (see Timber Trade History; Wheat). In the 20th century, Canada’s exports shifted to services, manufactured goods and commodities such as oil and metals.

Since the 1980s, Canada has signed free trade agreements with dozens of countries to increase global trade and investment.

Canada’s three biggest trading partners are the United States, the European Union and China. The United States is Canada largest trading partner by far. However, trade with China grew quickly in the 2010s, and this trend will likely continue.

Click here for definitions of key terms used in this article.

Exports are goods or services that residents of one country sell to residents of another country. Since its earliest days, Canada’s economic prosperity has relied on exports to larger markets; first through its colonial ties to Britain and later due to its geographic proximity to the United States. Billions of dollars of goods and services cross Canada’s border each year. (See International Trade.) Exports make up about a third of Canada’s gross domestic product (GDP). In 2019, Canadians exported $729 billion worth of goods and services. Almost 75 per cent of Canada’s total exports go to the United States. (See Canada-US Economic Relations.) Other major markets include the European Union, China and Japan.

In international trade, imports refer to goods and services purchased by Canadian residents from residents of other countries. Billions of dollars of goods and services cross Canada’s border each year. In 2019, Canadians imported a total of $768 billion worth of goods and services. Canada’s largest source of imports by far is the United States. (See Canada-US Economic Relations.) The European Union, China and Mexico are also major sources of imported goods and services.

The G7, or Group of Seven, is an international group comprising the governments of the world’s largest economies: Germany, France, Italy, Japan, the United Kingdom, the United States and Canada. It was founded as the G6 in 1975 and became the G7 with the addition of Canada in 1976. The Group is an informal bloc; it has no treaty or constitution and no permanent offices, staff or secretariat. The leaders of the member states meet at annual summits to discuss issues of mutual concern and to coordinate actions to address them. The meeting location and the organization’s presidency rotates among the members. The European Union is also a non-enumerated member, though it never assumes the rotating presidency.

The fur trade began in the 1600s in what is now Canada. It continued for more than 250 years. Europeans traded with Indigenous people for beaver pelts. The demand for felt hats in Europe drove this business. The fur trade was one of the main reasons that Europeans explored and colonized Canada. It built relationships between Europeans and Indigenous peoples.

(This article is a plain-language summary of the fur trade. If you are interested in reading about this topic in more depth, please see our full-length entry, Fur Trade in Canada.)

Pro pelle cutem (a Latin phrase meaning “a pelt for a skin”) is the traditional motto of the Hudson’s Bay Company (HBC). It was adopted soon after the company received its charter in 1670 and has remained on the HBC coat of arms, apart from a brief period of rebranding between 2002 and 2013.

The General Agreement on Tariffs and Trade (GATT) was an international trade agreement. It was signed by 23 nations, including Canada, in 1947. It came into effect on 1 January 1948. It also led to the creation of the World Trade Organization (WTO) in 1995. The GATT was focused on trade in goods. It aimed to reduce tariffs and remove quotas among member countries. The GATT helped reduce average tariffs from 40 per cent in 1947 to less than five per cent in 1993. The GATT was an early step toward globalization. The WTO replaced the GATT on 1 January 1995.

This article is a plain-language summary of the General Agreement on Tariffs and Trade (GATT). If you are interested in reading about this topic in more depth, please see our full-length entry: General Agreement on Tariffs and Trade (GATT).

Beaver pelts were an integral part of the early Canadian fur trade economy.