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330   HISTORY OF CANADA.

the year all British troops were withdrawn from Canada, with the exception of the force at Halifax. The Canadian provinces had now reached man's estate, and could undertake to garrison with their own soldiers the citadel at Quebec and such other posts as might be deemed necessary. The year was further marked by the passing of a Banking Act, the basis of our present banking system, which among financial authorities is considered one of the best in the world.

Treaty of Washington, 1871. — The abrogation of the Reciprocity Treaty in 1866 had opened up again the question of the right of American fishermen to ply their calling along the coasts of the Maritime Provinces. Canada enforced the terms of the convention of 1818 and seized several American vessels, thus creating much ill-feeling. There were other questions, too, which at this time threatened to cause trouble between Great Britain and the United States—the navigation of the St. Lawrence and the canals, the Oregon boundary, and, above all, the claims arising out of the depredations of the Southern cruiser Alabama, which had been fitted out in a British port. With a view to a friendly adjustment of all these questions, negotiations took place which resulted in the Treaty of Washington (1871). These negotiations deserve particular mention not only on account of the questions involved, but also because, for the first time, a Canadian plenipotentiary—in the person of Sir John A. Macdonald—took part in the settlement of Canadian relations with a foreign power. By the Treaty of Washington the Alabama claims were referred to a tribunal which afterwards sat at Geneva, in Switzerland, and awarded to the United States a very large sum, which Great Britain promptly paid. The settlement of the Oregon boundary by the Emperor of Germany has already been mentioned. In settlement of the fisheries question, it was agreed that the fisheries should be thrown open for a period of ten years, and that fish (except lake and river fish) and fish oil should be reciprocally admitted free of duty into the United States and Canada. What sum the United States should pay for the privilege, accorded to her fishermen, of fishing in Canadian waters was to be determined by three arbitrators. The arbitration was afterwards held at Halifax, in 1877—A. T. GaltEeing the Canadian arbitrator—and the sum of five and one-half millions of dollars was awarded to Canada, and duly paid.


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