The Daily, Wednesday, June 27, 2001. International trade in services

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International trade in services

Canada's overall trade deficit in international services increased in 2000 for the first time in six years, largely the result of a higher travel deficit.

The trade deficit in services - the difference between services that Canada exports and its payments to foreign suppliers - increased to $6.7 billion from $6.5 billion in 1999. The deficit in services had been declining since 1993, when it peaked at $13.6 billion.

Overall exports in services increased 6.9% in 2000 to $55.3 billion, while imports increased 6.6% to $62.0 billion.

Trade in services covers transactions in travel, transportation, commercial services and government services to Canada's trading partners.

The travel deficit went from $1.8 billion in 1999 to $2.1 billion in 2000. Canadians divided their increased spending about evenly between the United States and other countries, primarily for personal purposes. At the same time, spending by travellers to Canada lost momentum.

The deficit in commercial services rose marginally for a second year to $2.5 billion in 2000. This mainly reflected greater net payments for royalties and licences, specifically a combined rise in patents and industrial design, and a reduced surplus for software and other royalties. Offsetting these flows in part were net exports of research and development and a smaller deficit for advertising services.

In contrast, the deficit for transportation services, which covers both passengers and goods, narrowed from $3.0 billion to $2.9 billion. This reflected an increase in receipts from all broad types of transportation - air, water and land - which exceeded corresponding payments, except in the case of air transport services. Passenger transport was the main contributor to a 16% increase in revenues.

International services for public administration, including defence, were in surplus for the eighth consecutive year, a reflection of continued spending restraint by Canadian governments. Receipts for government services have increased for three straight years. The largest increases were in representational spending by foreign governments in Canada and for immigration services. On the payments side, all main components - for diplomatic representation, defence and provincial government outlays - levelled out or declined in 2000.

Matrices for the four countries newly released with this publication, as well as those for the global trading areas, will be available by July 20.

Canada's international trade in services, 2000 (67-203-XIB, $30; 67-203-XPB, $40) is now available.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Hugh Henderson (613-951-9049; hendhug@statcan.gc.ca), or Denis Caron (613-951-1861; caroden@statcan.gc.ca), Balance of Payments Division.