By the mid-1860s, British North America was facing various threats from the United States. Each colony was also dealing with challenges within its own borders. In the Province of Canada, the French-Catholic majority in Canada East and the English-Protestant majority in Canada West were locked in conflict. The Atlantic colonies needed ways to boost their economic development after the Reciprocity Treaty was cancelled. On the Pacific Coast, the colonies of Vancouver Island and British Columbia were facing financial problems after the end of the gold rush.

In the Province of Canada, ruling two very different groups (French and English) with one government was challenging, especially as the population grew. The government grew politically unstable. In Canada West, Conservative Party leader John A. Macdonald and Liberal Party leader George Brown were bitter rivals. They were divided over many issues, in particular those concerning French rights. Brown wanted to diminish French political power in the Province of Canada and assimilate French Canadians. Macdonald wanted to uphold the rights of the French and protect their equal representation in the government. Both leaders eventually agreed that unifying colonies through Confederation offered a better chance of resolving the political conflict over Canada East. This is because Confederation would mean that Canada West and Canada East would each have its own local government but would also work together under one federal, or centralized, government.

Many people in Canada East were opposed to the idea of Confederation. But their political leader, George-Étienne Cartier, believed the union would deliver greater protections, more independence, and a better future for the French. Cartier may have been persuaded in this belief by the support Macdonald had shown in protecting French-Catholic rights in the Province of Canada.

Macdonald, Brown, and Cartier formed an unlikely alliance in June 1864, known as the Great Coalition. The three leaders began working toward creating a federal system for the Canadas. But the goal was to expand the arrangement to include other colonies in British North America, as well as Rupert’s Land and the North-Western Territory. A legislative union would give more power to the central government for making laws and running the country. A federal union would give power to the central government, as well as to the provinces to run their own affairs.

Officials in Britain supported the idea of a union. But there were groups in every region of British North America that did not support the idea. They believed that uniting the colonies under one central government would cause more problems than it would solve.

Newfoundland’s economy was suffering in the 1860s due to a decline in the fishing industries. Some vocal opponents of Confederation persuaded Newfoundlanders that the economic decline was temporary. They used fear tactics to further the movement against Confederation.

The Maritime colonies were dealing with many challenges. Some people were concerned that joining with the Province of Canada in confederation would destroy the Maritime colonies’ power and independence. They instead believed that a Maritime union of New Brunswick, Nova Scotia, and Prince Edward Island offered a solution to many of their challenges. A Maritime union would also allow these colonies to pool their tax dollars to pay for much-needed infrastructure, such as roads and railways.

In September 1864, leaders from New Brunswick, Nova Scotia, and Prince Edward Island met to discuss the union of their three provinces at the Charlottetown Conference.

By the time Confederation was being considered, the fur trade was in serious decline in British North America. The bison were disappearing, and some First Nations were suffering from food shortages, famine, and new diseases brought over by the settlers.

Despite not owning the North-Western Territory and Rupert’s Land, Hudson’s Bay Company owned the rights to the fur trade in the region. Supporters of Confederation were eager to take over this vast land. They were worried about rumours that Hudson’s Bay Company was willing to sell the land to the United States.

Supporters of Confederation believed they needed to convince people in Canada East and the Atlantic colonies to join the union. But they saw the lands controlled by Hudson’s Bay Company as something that simply needed to be purchased in order to create settlements.

The end of the gold rush brought economic decline to the Pacific Coast. In 1866, the British government imposed a union on the colonies of Vancouver Island and British Columbia to help improve their economic situations. The union, however, lacked a government responsible to the people because it consisted of many appointed, rather than elected, officials. With debt rising, British Columbia considered joining Confederation. This was a challenge since the colony was cut off from the rest of the colonies in the east by the vast expanse of Hudson’s Bay Company lands. Also, some people in this region supported annexation by the United States over Confederation.