Custom essays on Economic Effects of World War One on Canada

After the World War One years there was a clear identify of the Canadian economy dependence from external markets. Over 50% of its exports were raw materials and intermediate goods. In 1929, the share of Canada’s global exports accounted for: nickel – 72%, asbestos – 72%, newsprint – 62%%, wheat – 32%, aluminum – 31%, zinc, lead, copper – 14%. The main market for Canada was U.S. market, which consumed about 40% of total exports. The share of Great Britain accounted for 33% of Canadian exports (Miller 2009).
Dependence on external market was also in the fact that the production of many goods exceeded demand in the domestic market. Thus, the wheat received by 5 times, newsprint – 10 times, non-ferrous metals – 20 times more than it was needed for domestic consumption. It created uncertainty and instability of the economy, totally dependent on the demand of the United States and Britain. There was also a need to import a range of manufactured goods from the U.S. and Britain. In 1928 the U.S. share of total Canadian imports was 68%, Britain share – 15%.
Prospects for the future prosperity of Canada were associated with abundant natural resources and significant immigration from Europe. The country has treated only 10% of the land, and deep rivers and lakes were promised the richest opportunities for hydropower. The Canadian forests area was more than 1 million square miles, so 2 / 3 of all the forests of the North American continent. Canada had 90% of the world’s known nickel reserves, 65% of asbestos, and 50% of cobalt (Marr 1980).
The difficult economic situation in the European capitalist countries caused a new wave of emigration across the ocean – to the U.S. and Canada. From 1921 to 1931 more than 1.5 million immigrants came to Canada. A special role in the development of the Canadian economy has played a world economic crisis of 1929-1933, from the devastating effects of which Canada could not recover for a long time. In 1930, almost all industries have reduced output by 12%. In 1933 the industrial output dropped by half. In 1931, exports decreased by 31%, imports – by 40% compared with 1930. All these led to even more dependence on U.S. capital, which seized the bankrupt Canadian company.
In addition to the agricultural crisis, the Canada also has suffered greatly from drought, cold winters and a sharp drop of grain prices on world markets. From 1929 to 1933, the world prices for agricultural products decreased by 88%. In 1930, 90 million bushels of wheat were at the elevators. Because of the low prices for wheat, it was burned in furnaces, left unharvested on the fields. During the crisis years, 240 thousand out of the 480 thousand Canadian farmers ruined.
The crisis has also affected the situation of the working class. In 1930, more than 50% of industrial workers were outside the gates of enterprises; 40% of factories worked on the shortened week. The situation of workers was compounded by the fact that there was no form of social security and insurance in Canada those years.
In the post-crisis period, the Canadian economy some time remained in a state of stagnation, and then experienced a new economic recession under the influence of the new world economic crisis. During the 1937-1938 the production dropped by 20%, Canadian exports have declined by 1/3; the number of unemployed amounted 14.8%. The lifeline for Canada in that situation was the increasing demand for strategic raw materials that helped preserve some recovery in some industries. Gold and copper production rose by 3 times, nickel and zinc – in 2 times, aluminum – almost 3 times the cost of production non-ferrous metals increased by 2 times. But automobile factories, shipyards, chemical, metallurgical and wood processing plants worked with half of the work load.
Meanwhile, the U.S. continued to invest money in industries such as rubber, aluminum, newsprint, non-ferrous metals mining and gold. In the prewar years, the share of U.S. capital in the production of nonferrous metals amounted 38-40% of Canada, in the rubber industry – 65%, in the car industry – 82% (Tucker 2005).
After the World War One, with the active support of the state, major Canadian monopolies have intensified their activities, taking advantage of the position of the British competitor. They seized the commanding heights of the rail, textile and metallurgical industry, power industry and financial and credit system. There was the merge of the government and nationalized private railways, the powerful state monopolies appeared – Canadian National Railways for 23 thousand miles which cost over $ 2 billion for the interests of major Canadian bourgeoisie of that period, the Association of Canadian Manufacturers (ACTs).
So, the World War One had positive and negative effects on Canada’s economy. Canada finally received the status of an independent country and a place at the Paris Peace Conference. Being in the camp of winners, Canada has got significant benefits for itself. More than 350,000 Canadian people were employed in the military industry; the Canadian plants produced over 66 million bombs, the country’s economy was revived. New jobs were created, exports and investment increased in the country. Part of the Canadian population has rallied for the victory, and despite the political crisis in 1917, the war contributed to the growth of national consciousness as well as economy. At the same time, the split between the Francophone and Anglophone Canadians increased.
In addition to the positive aspects, the World War One brought negative aspects to Canada. Tariffs have increased. For example, in 1914 the country introduced the law on measures in wartime. Law imposes censorship, allowed the deportation and arrest. 8579 citizens of Austria-Hungary, which was an opponent of Canada in the war, were incarcerated in prisons. The government nationalized all railroads of the country except the Pacific. By the end of the war the total public debt rose from 544 million dollars (1914) to 2.5 billion dollars (1919). The World War One in Canada is essential, and disputes over what role the war played for Canada, do not cease until now.

References

Alexander, D. “Economic growth in the Atlantic region, 1880-1940” in Watkins and Grant p. 239-241. Print.
Buckley, K. “Capital formation in Canada, 1896-1930” in Watkins and Grant, p. 211-213. Print.
Marr, William L., Paterson, Donald G. Canada, an economic history. 1980. pp. 321-325. Print.
Miller, Frederic P., Vandome, Agnes F., McBrewster, John. Economic History of Canada: Economic History of Canada, National Policy, Canadian Confederation, Great Depression in Canada, Economy of Canada, History of Canada, Science and Technology in Canada, Economic History. 2009. pp. 65-68. Print.
Morton, Desmond. A short history of Canada. 2002. pp. 78-7-81. Print.
Tucker, Spencer. Encyclopedia of World War I‎. 2005. pp. 255. Print.