Canada's international trade in services

The services trade deficit - the difference between Canadian receipts for its exports of services and its payments to foreign suppliers for their services - remained virtually unchanged at $8.3 billion in 2002.

Exports of services experienced their first downturn since 1982, down 1.0% to $58.3 billion. Payments also decreased, down 0.9% to $66.7 billion.

In 2002, Canada's travel deficit was the lowest since 1987, shrinking to $1.8 billion. US residents travelling to Canada raised their expenditures, while receipts from other foreign travellers remained flat. Canadian travellers spent less in the United States but more in overseas countries. This is in line with the trend seen since the early 1990s, as a growing proportion of Canadian travellers choose destinations other than the United States when they spend at least one night outside Canada. Overall, the travel industry has not yet fully recovered from the events of September 2001.

With fewer Canadians travelling abroad, the deficit for air transportation was reduced as a result of lower payments for passenger fares on foreign carriers. However, this was offset by a higher deficit in water transportation, as imports of goods by sea recovered in 2002.

The deficit on commercial services rose marginally by $0.2 billion to $3.7 billion in 2002, as both revenues and payments declined. Surpluses for computer services and for research and development - both of which saw record levels in 2000, at the height of activity in the high tech industry - continued to decline. Their combined surplus, which stood at $4.8 billion in 2000, was $3.5 billion in 2002. The only categories of commercial services that saw significant improvements in their balances were architectural and engineering services, financial services (other than insurance), and tooling and other services.

Reinsurance services and management services (especially between related parties) have both seen important reductions in receipts and payments following record levels in 2001.

Data on imports and exports of services for three major categories of services (travel, commercial services, and transportation and government services) for 59 individual countries and more than 20 geographic or economic regions are now available for 2001.

Note: Trade in services covers transactions in travel, transportation, a range of business and professional services referred to as commercial services, and government services.

Available on CANSIM: tables 376-0031 to 376-0034 and 376-0036.

Definitions, data sources and methods: survey number 1536.

The 2002 issue of Canada's international trade in services (67-203-XIB, $30) will be available soon.

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