ZCZC
BCN-04
CANADA-TRADE
Canada trade deficit with US narrows
OTTAWA, March 7, 2020 (BSS/AFP) – Canada’s surplus with its biggest trading partner the United States narrowed in January while the coronavirus epidemic hindered trade with China, according to government data released Friday.
Overall, Canada’s trade deficit with the world widened from a revised Can$732 million (US$545 million) in December 2019 to Can$1.5 billion (US$1.1 billion) in January, said Statistics Canada.
The agency had previously reported a much smaller trade deficit in December, but in a revised statement it noted higher imports and lower exports in the month.
Meanwhile, Canada’s trade surplus with the United States narrowed from Can$4.7 billion in December 2019 to Can$3.6 billion in January. This was its smallest surplus since February 2019.
A slowing of the Chinese economy as Beijing stepped up efforts to contain the spread of the new coronavirus also resulted in a steep drop in Canadian trade with its number two partner.
This compounded a downward trend in the second half of 2019 due to strained ties over Canada’s arrest on a US warrant of Huawei executive Meng Wanzhou and China’s detention in apparent retaliation of two Canadians.
Imports from China in 2019 totaled Can$46.8 billion, and exports to China settled at Can$24.4 billion.
In January, exports to China decreased 7.8 percent with lower sales of gold, potash and wood pulp contributing most to the drop.
Imports from China fell 12.1 percent to the lowest level in three years, with purchases of cell phones posting the largest decline.
Statistics Canada said total Canadian exports fell 2.0 percent in January to Can$48.1 billion in part due to lower shipments of motor vehicles.
Total imports were down 0.5 percent to Can$49.6 billion, mostly on lower purchases of pharmaceuticals.
The agency cited temporary shutdowns at assembly plants and the recent closure of a General Motors factory in Oshawa, Ontario, for the drop in exports of motor vehicles and parts.
For the same reasons, imports of motor vehicle engines and parts were also down substantially in January.
After surpassing Can$50 billion per month through most of 2018 and 2019, imports have been below the threshold for the past three months.
Fewer imports of antiviral and cancer drugs pushed down overall imports of pharmaceutical products (-26.1 percent) after four consecutive months of growth, over which they rose by the same amount.
Imports of gold for refining purposes, however, rose on higher prices, and crude oil imports hit the Can$2.0 billion mark for the first time since 2014.
BSS/AFP/MMA/1225HRS