Commercial reproduction and distribution are prohibited except with written permission from Global Affairs Canada. While the Internet of Things, sensors, and blockchain technology can make the production and certification process more transparent, contract-intensive products can use digital technologies to increase trust (for example, with rating and matching systems), which reduces the need to use intermediaries as trust facilitators. The U.S. services trade surplus with Canada was $29.2 billion in 2019. Decreasing CDIA was mostly due to lower investment in the United States, down 60% to $33 billion, mainly caused by the decline in M&A (-77%). According to World Trade Organization (WTO) trade statistics, world merchandise exports fell 22% and imports fell 23% from 2008 to 2009. Bélanger Baur, Audrey. After a broad-based upswing in growth that lasted nearly two years, the global economy started to decelerate in the second half of 2018, causing global growth in 2018 (3.6%) to be slightly lower than that for 2017 (3.8%). Highlights. Another issue of interest is the high level of household debt in Canada. Using the Survey on Financing and Growth of Small and Medium Enterprises as the main source of data, the report found that despite their great importance to the domestic market, SMEs in Canada have little participation in exporting. Products with a 0 to 5 pp tariff decline fell by 6.8%. Under UIC, China accounted for 3.3% of Canadian FDI (sixth in the ranking), compared to IIC, where it accounted for 1.9% (ninth in the ranking). Scarffe, Colin. “Canada’s International Trade in Information and Communications Technologies (ICT) and ICT-enabled Services.” Latest Developments in the Canadian Economic Accounts, Statistics Canada, Cat. More trade and investment means more economic growth and good-paying jobs to help further strengthen Canada’s middle class. Gains were led by technical, trade-related and other business services (+$1.2 billion, up 10%), financial services (+$1.0 billion, up 10%) and telecommunications, computer, and information services (+$879 million, up 8.3%), while a $1.2 billion decline in exports of professional and management consulting services partially offset the advance. Defined by the United Nations Conference on Trade and Development (UNCTAD) and Statistics Canada as “services that have the possibility to be delivered remotely over ICT networks, but that could also be delivered otherwise.”. Overall, export prices increased 2.9% while import prices grew 2.4%, and Canada’s terms of tradeFootnote 11 improved for the second consecutive year to 94.5, an improvement of 0.4 percentage point over the previous year. The Ontario Trade Fact Sheets are one-page summaries of Ontario's trade relationships with key partners based on data supplied by Statistics Canada. Finally, the chapter investigated a new dimension of trade diversification, that of exporter ownership, summarizing two reports on women-owned exporters and Indigenous-owned exporters, respectively. A closer look at the affected products (those on which tariffs were reduced or eliminated) showed that products subject to a 5 to 10 pp decrease in tariffs saw their exports to the EU increase 27%, while those with a greater than 10 pp tariff reduction saw exports rise 22%. The IMF expects economic growth to slow to 3.3% in 2019, from 3.6% in 2018, before returning to 3.6% in 2020. Goods-producing industries grew at 2.2% in 2018, slightly faster than services-producing industries (2.0%). However, wage growth in the province was solid, at 2.8%. Exports with a value of less than $150 million over the October 2017 to September 2018 period were excluded. In its Fall Economic Statement (FES) 2018, the government launched an export diversification strategy, with a target of increasing Canada’s overseasFootnote 24 exports by 50% by 2025. Most goods imported into Canada are subject to the federal GST, which is calculated at the rate of 5% of the duty-paid value of the shipment. Value of Canada’s fish and seafood exports to the US (Canada’s largest export destination by value) was $4.27B1, accounting for 62 per cent of total Canadian fish and seafood exports by value. In Italy, an elevated sovereign spreadFootnote 3 continued to put downward pressure on the economy, and growth declined to 0.9% in 2018 from 1.6% in 2017. The five most highly valued merchandise export and import categories have been identified using values for 2018. General. Merchandise imports in North America grew by 8.4%, with Mexico growing the fastest (10%) among the major economies, and Canada the slowest (6.1%). Other sectors that saw significant growth in their CDIA stock were management of companies and enterprises (+11%), mining and oil and gas extraction (+5.4%), and manufacturing (+11%). Canada trade missions and other international trade events for Canadian exporters. There are various avenues to greater geographical diversification. As a result, Canada and Mexico switched places in the ranking of global merchandise importers. Tree-map of Canada's goods exports in 2017. International trade makes up a large part of the Canadian economy, particularly of its natural resources. In 2019, Canada shipped weapons to 82 countries, down from 89 in 2018. 2. Export Development Canada (EDC) research* finds that most Canadian merchandise exporters (89%) sell to five or fewer markets, typically the United States. Because of this, WCS trades at a discount relative to WTI. Growth in non-durables was more robust at 2.9%, but negative growth in petroleum and coal product manufacturing mitigated some of the gain. The Canadian economy, and by extension Canadians, gain from this trade in many ways, with the growth of trade linked to higher incomes and living standards (State of Trade, 2012). Imports of financial services fell 7.3% or $895 million, while two small sub-sectors recorded double-digit growth—research and development services (+29%) and personal, cultural, and recreational services (+12%). Canada is a trading nation: in 2018, Canadian exports and imports of goods and services totalled $1.5 trillion, placing the share of trade in the economy at 66%. The Canadian government has made trade diversification a goal, with the target of increasing overseas exports by 50% by 2025. Energy includes the following categories: electricity; natural gas; fuel oil and other fuel; gasoline; and fuel, parts and accessories for recreational vehicles. In conjunction with slowing growth toward the end of 2018, forward-looking economic indicators, such as the Ivey Purchasing Managers Index (PMI) and the Bank of Canada’s Business Outlook Survey (BOS) Indicator, point to a decline in economic sentiment among Canadian businesses. Growth in Canadian Merchandise Exports to Korea, Data: Statistics Canada and Ministry of Strategy and Finance Korea, Growth in Canadian Merchandise Imports from Korea, * Export increases were calculated using Korean import data from the Ministry of Strategy and Finance Korea. The following looks at some possible ways in which Canadian exports could be further diversified. $336.8 billion or 75.4% of its overall exports. Measuring Canadian Export Diversification. The study found that in 2030, the top 40 global cities from a Canadian perspective will be dominated by the influence of the United States and China, which are projected to account for 40% and 20% of these cities, respectively. Data: Office of the Chief Economist calculations using data obtained from the Canadian Council for Aboriginal Business. Overview: In August 2020 Canada's Oats exports accounted up to C$64.8M and imports accounted up to C$1.04M, resulting in a positive trade balance of C$63.7M. Canada’s imports grew 4.6%, to remain in 14th place among the leading commercial services importers. “Characteristics of SME Exporters in Canada.” Global Affairs Canada, Office of the Chief Economist, Working paper (2019). A small proportion of Indigenous-owned SMEs (2.9%) sell internationally without also exporting to the United States. Imports Imports. Each year, 20% of all exporters move into new markets. Total inflows of FDI into Canada for 2018 increased by 70% to $55 billion, in contrast to the decrease experienced by most other developed economies, due to a $24-billion increase in FDI from non-U.S. sources. EXPORT STATISTICS. Along with time and cost reductions, the Internet also facilitates transaction processes by giving consumers the ability to order goods and services globally, either directly from a producer or via a digital platform. At the same time, most companies export only a few products, with 75% of exporters exporting five or fewer products. Canada Western Red Spring wheat Canada Western Red Spring wheat. As mentioned at the beginning of this chapter, geographic and product diversification are not the only dimensions of diversification. Overview: In April 2020 Canada's Rapeseed exports accounted up to C$610M and imports accounted up to C$15.2M, resulting in a positive trade balance of C$595M. Two recent OCE analytical reports looked at the benefits of FTAs to Canadian exporters; the first report analyzed the benefits from CETA, and the second investigated the benefits from the Canada-Korea Free Trade Agreement (CKFTA).Footnote 29. Figure 1 shows that electricity net export volumes decreased 2% from 48.2 TW.h in 2018 to 47.0 TW.h in 2019. In contrast to last year, commercial services exports rose modestly in 2018, up 5.2%, or $3.6 billion, to reach $73 billion. At the HS2 Footnote 21 product level, Canadian exports are found to be diversified, with an HHI score of 0.09 in 2018. The low-carbon goods and services that Canada exports do have a role to play in reducing global emissions, but article 6 does not offer a path to getting GHG credit for them. The analysis takes into consideration the future economic growth of some 780 cities and Canada’s current economic ties with them. With Electronic Data Interchange, exporters/importers can file documents electronically at the border, and Electronic Single Window lets exporters/importers submit all their documentation at one place instead of several, reducing time and costs. * Tapp, Stephen and Yan, Beiling 2019 “Patterns and Benefits of Canadian Export Diversification”, Export Development Canada (EDC), Research and Analysis Department, work in progress. First, 70% of existing exporters sell to a single market, usually the United States. Nearly half sell exclusively to the United States, and the other 55% sell to both the United States and other international markets. “Women-owned Small and Medium Enterprise Exporters in Canada.” Global Affairs Canada, Office of the Chief Economist, Working paper (2019a). Again, this underlines how the product and geographic dimensions of diversification intersect. World commercial services imports grew 7.4% in 2018, with Africa leading the way at 13% and accounting for 3.1% of overall world commercial services imports. While Canadian exports were found to be diversified by product, they are concentrated by geographic market. Nevertheless, Canada continued to run a services trade deficit with every broad region and most major trading partners; nearly half of this deficit was with the United States. Between April 2019 and April 2020 the exports of Canada's Rapeseed have increased by C$275M (81.9%) from C$335M to C$610M, while imports decreased by C$-14.4M (-48.7%) from C$29.7M to C$15.2M. Second are the geopolitical risks and the fact that a developed economy like the United States tends to have lower geopolitical risks due to a strong legal and financial system, democratic institutions, and a market-based economy, in addition to strong historical ties with Canada. Women-owned Exporters: The proportion of exporting SMEs that are women-owned in Canada doubled from 2011 to 2017, rising from 7.4% of all SME exporters in 2011 to account for 14.8% of SME exporters in 2017. To estimate the value of exports to U.S. and overseas destinations, 2017 shares were applied to total export growth. Global trade tensions combined with waning cyclical forces reduced economic momentum worldwide. Additionally, men-owned SMEs report at a lesser rate foreign administrative obstacles to exporting as an important impediment to exports than both women-owned and equally-owned SMEs. Indigenous-owned Exporting Small and Medium Enterprises in Canada. The top three categories of products which the EU and Canada exported to each other in 2018 were: Machinery (25.6 % of EU exports to Canada and 24.3 % of its imports) Chemical and pharmaceutical products (16.2 % of EU exports and 9.1 % of its imports) After WWII, Canada’s economy developed rapidly fueled by growing service, manufacturing, and mining sectors. This problem occurs when a single commodity makes up a large portion of a country’s exports. As a result, Mexican exports surpassed those of Canada, causing the two countries to switch rank (12th to 13th for Canada and 13th to 12th for Mexico) among the largest merchandise exporters to the world. See chapter 3 factsheet, Chapter 1.3 Global investment performance, Chapter 2.1 Canada’s economic performance, Chapter 2.3 Canada’s foreign direct investment performance. 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