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Economic Analysis Research Paper Series
Canada's International Investment Position: Recent Trends and Implications for Aggregate Measures of Income and Wealth
5. Appendix
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Changes in the composition of the external financial assets and the external financial liabilities
This appendix complements earlier tabulations on changes in the relative value of external assets and liabilities for each of the three investment categories examined herein (as presented in Figure 1). Below is a review of the broad asset mix and the liability mix, which asks how changes in different types of investment have reflected the overall composition of external assets and liabilities.
Chart 16 Composition of external assets, by investment class
On the asset side, Canadian portfolio investments and direct investments abroad have occupied an increasing share of the external asset mix since the mid-1990s. Portfolio investments accounted for about 20% of total assets in 1995, and their share has reached highs just over 30% around 2006/2007. Direct investments abroad increased from 36% of total assets in 1995 (the year in which total FDI assets exceeded liabilities) to 42% in 2010 (down from a high of 47% in 2004). Consequently, the importance of the residual category of other assets has declined—though these investments still represented about 30% of total external assets in 2010.
On the liability side, the importance of FDIC has increased relative to that of foreign claims on Canadian portfolio assets. In 2010, FDIC represented about 34% of total external liabilities (up from about one-fifth (22%) of external liabilities in 1995). Portfolio liabilities accounted for 44% of external liabilities in 2010 (down from 55% of liabilities in 1995). The share of other liabilities was 23% in 2010.
Chart 17 Composition of external liabilities, by investment class
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