- Canada's trade deficit narrowed to $2.9 billion in April as exports rose 1.1% outpaced a 0.9% import increase. Exports of industrial machinery and energy products grew while aircraft exports declined. Imports were driven up by aircraft and energy products. - The trade surplus with the US narrowed as US imports grew more than exports. The non-US trade deficit also narrowed as exports to other countries increased. - Key sectors discussed included forestry, oil, and the impact of the Fort McMurray fire. The conclusion discussed ongoing challenges for oil prices and infrastructure needed to support trade.

1. Merchandise Trade – Canada
– April 2016
By: Paul Young, CPA, CGA

2. • This presentation is one perspective on Canada Merchandise Trade

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
• Merchandise Trade
• Key Sectors
• Trade Deficits/Surplus
• Trade Partners
• Conclusion

5. Merchandise Trade
• Summary
• Canada's trade deficit narrowed to $2.9 billion in April ($3.2 billion in March), as a 1.1%
increase in exports outpaced a 0.9% rise in imports. In real terms, exports were up by a more
modest 0.5% while imports rose 0.8%.
• The growth in exports was driven by a few industries. These included industrial machinery,
equipment and parts (+10.5%), which showed the largest growth in 15 years, and energy
products (+7.6%) – although this was largely a price story, with volumes down 1.9%.
Providing some offset, exports of aircraft and other transportation equipment and parts slid
10% during the month, following sharp increases during the two months prior.
• Imports were driven up by a 52% surge in aircraft and other transportation equipment and
parts, as well as a rise in energy products (+5.9%), which again was due to higher prices, as
import volumes fell. On the flipside, imports of industrial machinery and equipment fell for a
fourth straight month to the lowest level since March 2014.
• Canada's trade surplus with the U.S. narrowed slightly in April, as imports (+3.0%) rose by
more than exports (+2.3%). Meanwhile, the trade deficit with the rest of the world narrowed
thanks to higher exports to countries other than Canada's main trading partners.

6. Merchandise Trade by Sector Highlights
• Exports are forecasted
to hit $510B for 2016
down from $515B in
2015
• Forestry
• Strong US Housing
Starts
• Oil Sector
• Fort MacMurray
Fire
• Low Commodity
Prices
• Scale of back of
Capital

7. Trade Surplus/Deficit • Imports from countries other than the
United States fell 3.0% to $15.0 billion.
• In April, there were lower imports
from Germany (-$174 million) and
South Korea (-$170 million). Exports to
countries other than the United States
decreased 0.6% to $10.5 billion.
• Lower exports to the United Kingdom
(-$276 million) and Spain (-$105
million) were mostly offset by higher
exports to countries other than
Canada’s principal trading partners
(+$268 million) and to Mexico (+$105
million).
• As a result, Canada’s trade deficit with
countries other than the United States
narrowed from $4.9 billion in March to
$4.5 billion in April.

8. Trade by Province

9. Conclusion
• Oil continues to struggle to get above $50/Barrel
• Alberta lost oil production due to Fort McMurray Fire
• Softwood Lumber Agreement (old agreement has expired)
• New Liberal Government (what is there stance on trade)
• Government Policies
• Environmental Assessments
• Clean Technology Investment
• Infrastructure funding
• Money needed to expand ports like Montreal, Sydney, Saint John, Winnipeg, Prince
Rupert, etc
• Pipelines, rails, bridges, roads , etc investment to support moving goods to market