Imperial Preference was a system of mutual tariff reduction enacted throughout the British Empire as well as the then British Commonwealth (now simply known as Commonwealth of Nations) following the Ottawa Conference of 1932. [1] As Commonwealth Preference, the proposal was later revived in regard to the members of the Commonwealth of Nations. Joseph Chamberlain, the powerful colonial secretary from 1895 until 1903, argued vigorously that Britain could compete with its growing industrial rivals (chiefly the United States and Germany) and thus maintain Great Power status. The best way to do so would be to enhance internal trade inside the worldwide British Empire, with emphasis on the more developed areas — Australia, Canada, New Zealand, and South Africa — that had attracted large numbers of British settlers. [2]
The Dominions enacted policies of imperial preference in the late 19th and early 20th century: Canada (1897), New Zealand (1903), South Africa (1903), and Australia (1907). [3] While Canada's policy of imperial preference had the effect of increasing its imports from Britain (by approximately one-half), the policies of New Zealand and Australia did not. [4] [5] [6] Due to its commitments to free trade, Britain did not reciprocate these trade policies, to an appreciable extent, until the 1932 Ottawa Conference amid the Great Depression. [3]
In 1660, the practice of "Old Subsidy" gave certain imported colonial products a virtual monopoly in England, effectively starting a form of colonial preference for sugar. By 1840, this had been extended such that more than eighty commercial goods were protected, as the Corn Laws protected some colonial agricultural goods. Colonial conferences held throughout the late 19th century arranged closer economic unions between Dominions and the mother country, with the Dominions giving preferences in exchange for defence commitments or common commercial, patent, immigration and shipping policies. [7] [8]
In the late 1800s and especially during the early 1900s, Imperial Preference was considered a method of promoting unity within the British Empire and sustaining Britain's position as a global power as a response to increased competition from the protectionist Germany and United States. [9] [ page needed ] [7] In the decades before the First World War, the Dominions enacted policies of imperial preference: Canada (1897), New Zealand (1903), South Africa (1903), and Australia (1907). [3] However, Britain did not reciprocate these trade policies towards the Dominions due to its free trade commitments. [3] It was not until the Great Depression that Britain reciprocated. [3]
The idea was associated particularly with Joseph Chamberlain, who resigned from the government of Arthur Balfour in September 1903 in order to be free to campaign for Tariff Reform. Among those opposing Chamberlain was the Chancellor of the Exchequer, Charles Thomson Ritchie, who, guided by the free-trade ideas of the leading economists of the time, such as Sir William Ashley, was vigorously opposed to any scheme of Imperial Preference. This ultimately resulted in a damaging rift within Balfour's Conservative-Unionist coalition government, contributing to its defeat in the 1906 elections.
During the 1920s, Imperial Preference became popular once more, mostly through the good will of Lord Beaverbrook and his Daily Express , once Lloyd George was ejected from office. Unfortunately for Beaverbrook, Bonar Law preferred Lord Derby and his fear of opposition to a policy of extra-mural Food Tax, and Beaverbrook was unable to adapt his scheme, [10] perhaps because of the economics: [11]
For at that time there could be no advantage to the Dominions unless Empire food was admitted to Britain tax free—and Britain imported more than half of her consumption of food.
Law died in office before his first year in power was complete, and was succeeded by Stanley Baldwin, who was a tepid supporter of the scheme. He called the 1923 elections specifically to introduce protectionist policies and lost, leading to the first minority Labour government. Baldwin's Conservatives came back to power after the 1924 elections without a protectionist policy. His Colonial and Dominions Secretary, Leo Amery, was one of its strongest supporters and in 1926 established the Empire Marketing Board to encourage Britons to 'buy Empire'. [12] But Winston Churchill, Chancellor of the Exchequer of the Baldwin government, a former Liberal and always a no-holds-barred free trader, was an opponent. Public opposition to protectionism contributed to the Conservative loss of power again in the 1929 elections [ citation needed ] and the creation of the second Labour government.
The 1931 elections supported a National Government nominally led by former Labour prime minister Ramsay MacDonald but with an overwhelming majority of MPs being Conservatives under Baldwin; these largely supported Imperial Preference as a response to the Great Depression. In 1932, representatives of Britain, the Dominions, and the Colonies held the Commonwealth Conference on Economic Consultation and Co-operation in Ottawa, Ontario, Canada. They agreed to implement policies of Imperial Preference for five years. [13] This new policy was based on the principle of "home producers first, empire producers second, and foreign producers last" [1]
In 1935, the Canadian Prime Minister, R. B. Bennett, a Conservative endorsed Imperial Preference.
After World War II and the signing of the General Agreement on Tariffs and Trade in 1947, the extension of preferential tariffs was prohibited and the margins reduced. Inflation, combined with the general liberalisation of trade around the world, ended the formal system of imperial preference. [1]
Brexit has sparked increased interest in forming trade agreements between the United Kingdom and the Commonwealth. [14]
The Italian Empire, Spain, Portugal, France, Japan, and the United States all had varying degrees of preference between their mainland and their colonies. [15]
The Tariff Act of 1890, commonly called the McKinley Tariff, was an act of the United States Congress, framed by then Representative William McKinley, that became law on October 1, 1890. The tariff raised the average duty on imports to almost 50%, an increase designed to protect domestic industries and workers from foreign competition, as promised in the Republican platform. It represented protectionism, a policy supported by Republicans and denounced by Democrats. It was a major topic of fierce debate in the 1890 Congressional elections, which gave a Democratic landslide.
Free trade is a trade policy that does not restrict imports or exports. In government, free trade is predominantly advocated by political parties that hold economically liberal positions, while economic nationalist and left-wing political parties generally support protectionism, the opposite of free trade.
William Maxwell Aitken, 1st Baron Beaverbrook, generally known as Lord Beaverbrook, was a Canadian-British newspaper publisher and backstage politician who was an influential figure in British media and politics of the first half of the 20th century. His base of power was the largest circulation newspaper in the world, the Daily Express, which appealed to the conservative working class with intensely patriotic news and editorials. During the Second World War, he played a major role in mobilising industrial resources as Winston Churchill's Minister of Aircraft Production.
Protectionism, sometimes referred to as trade protectionism, is the economic policy of restricting imports from other countries through methods such as tariffs on imported goods, import quotas, and a variety of other government regulations. Proponents argue that protectionist policies shield the producers, businesses, and workers of the import-competing sector in the country from foreign competitors and raise government revenue. Opponents argue that protectionist policies reduce trade, and adversely affect consumers in general as well as the producers and workers in export sectors, both in the country implementing protectionist policies and in the countries against which the protections are implemented.
The Conservative Party of Canada was a major federal political party in Canada that existed from 1867 to 1942. The party adhered to traditionalist conservatism and its main policies included strengthening relations with Great Britain, nationalizing industries, and promoting high tariffs.
The National Policy was a Canadian economic program introduced by John A. Macdonald's Conservative Party in 1876. After Macdonald led the Conservatives to victory in the 1878 Canadian federal election, he began implementing his policy in 1879. The protective policy had shown positive responses in the economy with new industries flourishing Canada's economy in the 1880s. John A. Macdonald combined three elements as a strategy for the post-Confederation economy. First, by calling for high tariffs on imported manufactured items to protect the manufacturing industry. Second, by calling for a massive expansion of physical infrastructure, such as roads and railroads. Finally, enabled and supported by the former two, by promoting population growth, particularly in western Canada. The building of the Canadian Pacific Railway, and the fostering of immigration to Western Canada. Macdonald campaigned on the policy in the 1878 election, and defeated the Liberal Party, which supported free trade. It lasted from 1879 until sometime in the early 1950s.
Leopold Charles Maurice Stennett Amery, also known as L. S. Amery, was a British Conservative politician and journalist. During his career, he was known for his interest in military preparedness, British India and the British Empire and for his opposition to appeasement. After his retirement and death, he was perhaps best known for the remarks he made in the House of Commons on 7 May 1940 during the Norway Debate.
The British Empire Economic Conference was a 1932 conference of British colonies and dominions held to discuss the Great Depression. It was held between 21 July and 20 August in Ottawa.
The Imperial Federation was a series of proposals in the late 19th and early 20th centuries to create a federal union to replace the existing British Empire, presenting it as an alternative to colonial imperialism. No such proposal was ever adopted, but various schemes were popular in Australia, Canada, New Zealand, and other colonial territories. The project was championed by Unionists such as Joseph Chamberlain as an alternative to William Gladstone's proposals for home rule in Ireland.
The Tariff Reform League (TRL) was a protectionist British pressure group formed in 1903 to protest against what they considered to be unfair foreign imports and to advocate Imperial Preference to protect British industry from foreign competition. It was well funded and included politicians, intellectuals and businessmen, and was popular with the grassroots of the Conservative Party. It was internally opposed by the Unionist Free Food League but that had virtually disappeared as a viable force by 1910. By 1914 the Tariff Reform League had approximately 250,000 members. It is associated with the national campaign of Joseph Chamberlain, the most outspoken and charismatic supporter of Tariff Reform. The historian Bruce Murray has claimed that the TRL "possessed fewer prejudices against large-scale government expenditure than any other political group in Edwardian Britain".
The Empire Marketing Board was formed in May 1926 by the Colonial Secretary Leo Amery to promote intra-Empire trade and to persuade consumers to 'Buy Empire'. It was established as a substitute for tariff reform and protectionist legislation and this is why it was eventually abolished in 1933, as a system of imperial preference replaced free trade. During its brief existence, the Empire Marketing Board was unsuccessful in raising Britain's imports of products from the Empire.
The Empire Free Trade Crusade was a political party in the United Kingdom. It was founded by Lord Beaverbrook in July 1929 to press for the British Empire to become a free trade bloc.
The Imperial Federation League was a 19th-century organisation which aimed to promote the reorganisation of the British Empire into an Imperial Federation, similarly to the way the majority of British North America confederated into the Dominion of Canada in the mid-19th century. The League promoted the closer union of the British Empire and advocated the establishment of "representative government" for the UK, Canada and the self-governing colonies of 'Australasia' and Cape Colony within a single state.
Stanley Walter "S. W." Alexander was a British journalist and political activist.
Australia and Canada have a longstanding relationship fostered by both countries' shared history and culture as well as the links between residents of the countries. The two countries are former British Dominions and have a common head of state in King Charles III. Both countries are members of the Asia-Pacific Economic Cooperation, Cairns Group, Commonwealth of Nations, Five Eyes, OECD and the United Nations.
The 1902 Colonial Conference followed the conclusion of the Boer War and was held on the occasion of the coronation of King Edward VII. As with the previous conference, it was called by Secretary of State for the Colonies Joseph Chamberlain who opened it on 30 June 1902.
The 1923 Imperial Conference met in London in the autumn of 1923, the first attended by the new Irish Free State. While named the Imperial Economic Conference, the principal activity concerned the rights of the Dominions in regards to determining their own foreign policy.
The Barton government was the first federal executive government of the Commonwealth of Australia. It was led by Prime Minister Sir Edmund Barton, from 1 January 1901 until 24 September 1903, when Barton resigned to become one of the three founding judges of the High Court of Australia.
Commonwealth free trade is the process or proposal of removing barriers of trade between member states of the Commonwealth of Nations. The preferential trade regime within the British Empire continued in some form amongst Commonwealth nations under the Imperial Preference system, until that system was dismantled after World War II due to changes in geopolitics and the pattern of global trade, and the United Kingdom's entry into the European Economic Community. The idea of promoting renewed inter-Commonwealth trade emerged in the late 20th century as a response to the evolution of the global economy. At one extreme, proposals have been raised for the creation of a multilateral free trade area comprising all member states of the Commonwealth of Nations.
Australian governments, both those of the colonies after the introduction of responsible government in the 1850s and the national government since federation in 1901, have had the power to fix and change tariff rates. This power resides in the respective legislatures, with tariffs, being a tax law, is required to originate in the lower house of the legislature.
initial period of five years in the United Kingdom in November 1932.
