11 International and inter-provincial trade in goods and services

Printable version (PDF) of Chapter 11 (June 30, 2008)


International trade

11.1 International trade is part of a vast system of statistics on Canada's transactions with non-residents. The system measures the flow of thousands of different goods and services across the border to and from countries around the world. The statistics on goods can be compiled on either a customs-basis or a balance of payments basis. The Canadian System of National Accounts (CSNA) uses the latter interpretation. This chapter discusses trade in the income and expenditure-based gross domestic product (GDP) framework.

11.2 Statistics on international trade are compiled both nationally and provincially. Foreign trade is reflected in both the quarterly economy-wide measures of GDP and the non-resident sector account (National Income and Expenditure Accounts) as well as the annual provincial measures of GDP (Provincial Economic Accounts).

11.3 International trade is essential to Canada's open economy. In 2002, for example, exports accounted for 42% of Canada's GDP and imports 37%. In other words, exports totalled $479 billion while imports totalled $428 billion relative to a total GDP of $1,153 billion in 2002. Export demand is largely determined by foreign income and the ratio of foreign to domestic prices; where import demand is largely determined by national income and the relationship of domestic prices to foreign prices. International trade flows are also affected by factors including sharp fluctuations in exchange rates and international trade arrangements.

Inter-provincial trade

11.4 Inter-provincial trade flows by province are similarly significant. These sales or purchases of goods and services among provinces and territories are largely determined by the regional levels of economic activity (income) and by the composition of economic activity in those regions of Canada. The Provincial Economic Accounts provides this detail alongside the international trade detail for each province and territory.


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