This presentation will discuss exports, imports and trade balances for month of May 2016.

1. Merchandise Trade – Canada
– May 2016
By: Paul Young, CPA, CGA
July 7, 2016

2. Disclaimer
• This presentation is one view of Merchandise Trade for Canada

3. Paul Young - Presenter
Bio
• CPA/CGA
• 25 years of experience in Academia, Industry and Financial solutions
• Youtube Channel -
https://www.youtube.com/channel/UCAArky1bAXPSuV2NLtUnyLg

4. Agenda
• Summary
• Trade by sector
• Trade by Country
• Trade deficit/Surplus
• Regional Trade Analysis
• Government Policies

5. Summary / Trade
• Canada's exports fell 0.7% to $41.1 billion in May. Export volumes
declined 2.3% and prices were up 1.6%. Imports decreased 0.8% to
$44.4 billion, as volumes were down 0.9% and prices edged up 0.2%.
As a result, Canada's merchandise trade deficit with the world in May
was virtually unchanged compared with April at $3.3 billion.

6. Summary / Trade by Sector

7. Trade/Country
• After strong start of the year, Canadian merchandise
exports have taken a decided about-face. Total exports
declined 0.7% in May and have remained relatively stable
over the past three months compared to the volatility seen
in the past year, albeit at the lowest level since January
2014. That said, real shipment volumes were also down.
Canadian imports declined 0.8% as the depreciated
Canadian dollar and challenging business investment trends
weigh on demand from the rest of the world.
• As a result, Canada’s trade deficit remained virtually
unchanged from the record set in April, at $3.3 billion.
Exports to the US were up by 3.6% driven by recovering
import demand and supported by the competitive value of
the Canadian dollar, although the trend remains weak. This
is consistent with trade trends stateside, where imports
increased 1.5% while exports declined by a mild 0.2%.
• About one third of the total monthly decline in
merchandise exports was accounted for by lower exports to
the UK and China, although demand from most of the rest
of the world was lower as well. The weakness in exports for
the month of May was broadly-based, with eight out of 11
main product categories registering declines. On the
positive side, energy exports led the way and surprised
higher likely as a decline in refinery activity freed up crude
oil supplies for export, despite the anticipated impact of the
Alberta wildfires. Forestry exports advanced as well given
the continued support from a recovering US hosing market,
while the volatile aircraft sector also gained for the month.
Source: EDC Canada

8. Trade/Province

9. Trade Deficit • Exports to countries other than the United
States decreased 13.6% to $9.1 billion in May.
There were lower exports to the United
Kingdom (-$723 million), to countries other than
Canada’s principal trading partners (-$164
million) and to China (-$160 million). Imports
from countries other than the United States
edged down 0.1% to $15.1 billion in May.
• Lower imports from Japan (-$196 million) and
Peru (-$152 million) were partially offset by
higher imports from the United Kingdom (+$164
million).
• Consequently, Canada’s trade deficit with
countries other than the United States widened
from $4.6 billion in April to a record $6.0 billion
in May.
Source:
http://www.marketpulse.com/20160706/canada-
international-merchandise-trade-may-2016/

10. Government Policies / CETA
• Canada’s free-trade deal with the European Union has suffered a setback, after the European Commission bowed
to pressure to give Europe's parliaments the right to ratify the landmark agreement.
• The decision is meant to address public concerns, but could create more friction for the EU in the Brexit vote’s
aftermath.
• In the face of popular suspicion about secretive trade deals benefiting big companies, Commission President
Jean-Claude Juncker retreated from his position that the multi-billion-euro pact would only need support from
European Union governments and the European Parliament to go ahead.
• "I have looked at the legal arguments and I have listened to heads of state or government and to national
parliaments," Juncker said in a statement on Tuesday. "The credibility of Europe's trade policy is at stake."
• The 1,600-page text, which goes beyond tariffs to reduce transatlantic barriers to business, will now be sent to
each of the EU's 28 national parliaments, and in some cases, such as Belgium, to regional parliaments as well.
• Requiring national parliamentary approval for the agreement, first envisaged in 2009, raises the risk it will never
be implemented.
• Prime Minister Justin Trudeau said he remained “optimistic” about the ratification of the Comprehensive
Economic and Trade Agreement, known as CETA.
• “With the situations going on right now and the perceptions around the EU, it’s going to be very important for
[the European Commission] to demonstrate an ability to move forward on deals that are going to be good for
their citizens, good for businesses and good for international trade in general,” Trudeau said in Montreal on
Tuesday.

11. Key Links
• http://calgaryherald.com/business/local-business/canadian-farmers-
in-limbo-as-future-of-ceta-tpp-trade-deals-uncertain
• http://economictimes.indiatimes.com/opinion/interviews/canada-
india-fta-must-to-boost-trade-lyle-stewart-canadian-
minister/articleshow/52876339.cms
• https://heatst.com/uk/11-countries-gearing-up-to-strike-trade-deals-
with-britain/
• http://www.producer.com/2016/06/liberal-trade-policy-will-require-
rethink-following-brexit/