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The dawn of the Canada-U.S. free-trade era

The first-ever free trade deal between Canada and the United States took effect on Jan. 1, 1989.

'After all the rancour and bitter debate,' free trade came into effect on Jan. 1, 1989

CBC Archives ·

Free trade is almost here

36 years ago
Duration 1:58
On New Year's Eve in 1988, CBC reports on the free-trade deal that will come into effect the next day.
Thirty years ago today, the year that was 1988 was coming to a close, but there was a big change coming for Canada at the stroke of midnight — the onset of free trade with the United States.
A man smiles with a Canadian flag hanging in the background.
Prime Minister Brian Mulroney is all smiles before signing the proposed Free Trade Agreement between Canada and the United States, on Jan. 2, 1988. (Fred Chartrand/The Canadian Press)

"After all the rancour and bitter debate, it's just a matter of hours now until free trade comes into force," the CBC's Knowlton Nash told viewers tuning in to watch the last newscast of 1988.

The push for free trade had begun during then-Prime Minister Brian Mulroney's first term in power — and it had remained a major ballot-box issue when he and the Progressive Conservatives won a second majority government in November of 1988.

The deal had been announced in 1987 and subsequently signed by Mulroney in January of 1988. But the Free Trade Agreement didn't come into effect until Jan. 1, 1989.

The CBC's David Halton reported that U.S. President Ronald Reagan had called Mulroney on the last day of the year, to congratulate him for getting the free-trade bill passed through the Canadian Senate — just one day earlier.

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