Canada's balance of international payments,
fourth quarter 2015
Released at 8:30 a.m. Eastern time in The Daily, Monday, February 29, 2016
Canada's current account deficit (on a seasonally adjusted basis) edged up $0.1 billion in the fourth quarter to
$15.4 billion. On an annual basis, the current account deficit increased from $44.9 billion in 2014 to $65.7 billion
in 2015.
Chart 1
Current account balances
billions of dollars
5
0
-5
-10
-15
-20
IV I
2010
II III
2011
IV
I
II III
2012
Goods
IV
I
II III
2013
IV
I
II III
2014
IV
I
II III
2015
IV
Other current account components
Total
Note(s): Data are seasonally adjusted.
Source(s): CANSIM table 376-0105.
In the financial account (unadjusted for seasonal variation), transactions in the other investment category, mainly in
the form of currency and deposits, led the inflow of funds into the economy in the quarter. These inflows were
moderated by record Canadian investment in foreign securities.
Current account
The deficit on trade in goods narrows
The deficit on international transactions in goods narrowed by $0.3 billion to $4.8 billion, as imports declined more
than exports in the fourth quarter. However, for the year, the goods balance reached a record $23.6 billion deficit
after posting a slight surplus in 2014. This change largely reflected a $44.8 billion decline in exports of energy
products.
The Daily, Monday, February 29, 2016
On a regional basis, the goods surplus with the United States was down by $2.4 billion in the fourth quarter, mainly
on lower exports of energy products. On the other hand, the trade deficit with all other countries narrowed by
$2.6 billion, led by a stronger surplus with the United Kingdom.
Chart 2
Goods balances by geographic area
billions of dollars
20
15
10
5
0
-5
-10
-15
-20
IV I
2010
II III
2011
IV
I
II III
2012
United States
IV
I
II III
2013
IV
I
II III
2014
IV
I
II III
2015
IV
All other countries
All countries
Note(s): Data are seasonally adjusted.
Source(s): CANSIM table 376-0106.
Total exports of goods declined $2.3 billion to $131.9 billion in the quarter. Exports of energy products were down by
$2.3 billion mainly on lower prices. Crude petroleum accounted for the bulk of this reduction, as exports reached
their lowest level in more than five years. Crude oil prices have fallen more than 40% since the fourth quarter
of 2014. Exports of aircraft and other transportation equipment fell $0.6 billion during the quarter, as a result of
lower volumes. Basic and industrial chemical, plastic and rubber products also contributed to the overall decline,
with exports down $0.5 billion on lower prices. Partially offsetting these reductions was a $1.0 billion gain in motor
vehicles and parts, largely on higher volumes and prices for passenger cars.
Imports of goods were down $2.6 billion to $136.7 billion. As with exports, the most notable decline was recorded in
imports of energy products, which fell $1.5 billion on lower prices and volumes. Electronic and electronic equipment
and parts also accounted for an important share of the decrease, declining $0.7 billion after a strong third quarter.
Trade in services deficit edges down
The overall deficit on international trade in services narrowed $0.1 billion to $5.8 billion in the fourth quarter. In the
quarter, the travel deficit was down $0.1 billion to $4.0 billion as Canadians further reduced their spending in the
United States. The travel deficit narrowed in each of the four quarters in 2015. The transportation services deficit
also narrowed in the quarter, but the reduction was offset by a lower commercial services surplus.
2
Component of Statistics Canada catalogue no. 11-001-X
The Daily, Monday, February 29, 2016
For 2015 as a whole, the deficit increased slightly to $23.8 billion, reflecting a reduction in the commercial services
surplus, which was moderated by a lower deficit on international travel.
Deficits on investment income and current transfers expand
The investment income deficit edged up $0.1 billion to $3.4 billion in the fourth quarter. For the year as a whole, the
investment income deficit narrowed by $8.3 billion to $13.4 billion, largely on lower profits earned by foreign direct
investors in Canada.
Profits earned by Canadian direct investors on their assets abroad were down $1.5 billion in the fourth quarter,
while those earned by foreign direct investors on their Canadian assets declined $0.5 billion. At the same time,
receipts from portfolio investment advanced more than payments, moderating the overall increase in the investment
income deficit in the fourth quarter.
The deficit in current transfers rose $0.3 billion to $1.0 billion. Government transfer receipts were down more than
payments in the quarter.
Financial account
Canadian investment in foreign securities hits record high
Canadian investors acquired a record $37.1 billion of foreign securities in the fourth quarter, led by strong
investment activity in November and December. Nearly two-thirds of these purchases were in US instruments. On
an annual basis, Canadian investment in foreign securities totalled $60.3 billion in 2015. This was the largest such
outflow of funds since 2006, before the global financial crisis.
Canadian investors added $22.9 billion of foreign debt securities in the fourth quarter, led by record acquisitions of
US Treasury bonds. At the same time, Canadian investors purchased $14.1 billion of foreign shares, almost evenly
split between US and non-US instruments.
Component of Statistics Canada catalogue no. 11-001-X
3
The Daily, Monday, February 29, 2016
Chart 3
Canadian investment in foreign securities
billions of dollars
40
35
30
25
20
15
10
5
0
-5
-10
IV I
2010
II III
2011
Debt securities
IV
I
II III
2012
IV
I
II III
2013
IV
I
II III
2014
IV
I
II III
2015
IV
Equity and investment fund shares
Source(s): CANSIM table 376-0132.
Foreign acquisitions of Canadian securities resume
Foreign investment in Canadian securities resumed in the fourth quarter, reaching $20.6 billion. Foreign acquisitions
of Canadian bonds totalled $7.2 billion during the quarter, all bonds denominated in foreign currencies.
Non-resident investors acquired $4.1 billion of Canadian money market instruments. This activity was led by
purchases of US dollar-denominated instruments, mainly issued by Canadian private corporations.
Non-resident investors added $9.3 billion of Canadian equities to their holdings in the fourth quarter, following a
divestment in the third quarter. Canadian stock prices were down 2.2%, and the Canadian dollar depreciated
by 2.7 US cents against the US dollar in the quarter.
On an annual basis, foreign investment in Canadian securities was up compared with the previous two years to
$95.5 billion. Overall, portfolio investment generated a net inflow of funds into the Canadian economy of
$35.2 billion in 2015 and contributed in part to the financing of the current account deficit. The Canadian dollar
lost 14.0 US cents against the US dollar in 2015.
Outward and inward direct investment slow in the quarter
Transactions in direct investment assets totalled $10.7 billion in the fourth quarter. Canadian investment in foreign
affiliates in the form of equity was the main contributor, reaching $16.4 billion. However, Canadian affiliates reduced
their assets in the form of debt instruments contracted by their foreign parents.
On the other side of the ledger, direct investment liabilities generated an inflow of $8.9 billion in the fourth quarter.
Equity investment in Canadian affiliates of $22.3 billion was partially offset by a reduction in debt liabilities of
Canadian affiliates to their foreign parents.
4
Component of Statistics Canada catalogue no. 11-001-X
The Daily, Monday, February 29, 2016
Cross-border mergers and acquisitions, both inward and outward, were down significantly from the previous
quarter.
For the year, outward direct investment reached a record $104.3 billion in 2015, led by strong mergers and
acquisitions activity. Inward direct investment totalled $80.6 billion. As a result, the direct investment account
recorded a net outflow of funds of $23.7 billion, the second highest on record. This activity contrasted with net
inflows of funds recorded in the two previous years.
Chart 4
Foreign direct investment
billions of dollars
45
40
35
30
25
20
15
10
5
0
-5
IV I
2010
II III
2011
IV
I
Direct investment assets
II III
2012
IV
I
II III
2013
IV
I
II III
2014
IV
I
II III
2015
IV
Direct investment liabilities
Source(s): CANSIM table 376-0104.
The other investment category generates inflow of funds from abroad
The other investment category of the financial account generated a net inflow of funds of $29.3 billion in the fourth
quarter. A large increase in currency and deposits held by non-residents in Canada, mostly foreign currency
deposits, more than offset the increase in those held by Canadians abroad. Transactions in currency and deposits
of Canadian banks with their foreign affiliates and branches accounted for most of this activity.
Component of Statistics Canada catalogue no. 11-001-X
5
The Daily, Monday, February 29, 2016
Note to readers
Definitions
The balance of international payments covers all economic transactions between Canadian residents and non-residents in three
accounts: the current account, the capital account and the financial account.
The current account covers transactions in goods, services, compensation of employees, investment income and secondary income
(current transfers).
The current account data in this release are seasonally adjusted. For information on seasonal adjustment, see Seasonally adjusted data
– Frequently asked questions.
The capital account covers capital transfers and transactions in non-produced non-financial assets.
The financial account covers transactions in financial assets and liabilities.
In principle, a net lending (+) / net borrowing (-) derived from the sum of the current and capital accounts corresponds to a net lending (+)
/ net borrowing (-) derived from the financial account. In practice, as data are compiled from multiple sources, this is rarely the case and
gives rise to measurement error. The discrepancy (net errors and omissions) is the unobserved net inflow or outflow.
For more information on the balance of payments, consult the Frequently asked questions section in the System of macroeconomic
accounts module of our website. The module also presents the most recent balance of payments statistics.
Real-time CANSIM table
Real-time CANSIM table 376-8105 will be updated on March 7. For more information, consult the document Real-time CANSIM tables.
Next release
Balance of international payments data for the first quarter will be released on May 30.
6
Component of Statistics Canada catalogue no. 11-001-X
The Daily, Monday, February 29, 2016
Table 1
Balance of payments – Not seasonally adjusted
Fourth
quarter 2014
First quarter
2015
Second
quarter 2015
Third quarter
2015
Fourth
quarter 2015
2014
2015
millions of dollars
Capital account and current account
Net lending / net borrowing, from capital
account and current account
Current account balances
Goods and services
Goods
Services
Primary income
Compensation of employees
Investment income
Direct investment
Portfolio investment
Other investment
Secondary income
Capital account balance
Financial account1,2
Net lending / net borrowing, from financial
account
Net acquisition of financial assets
Direct investment assets
Direct investment assets, equity
Direct investment assets, debt instruments
Canadian portfolio investment in foreign
securities
Foreign debt securities
Foreign money market instruments
Foreign bonds
Foreign equity and investment fund shares
Official international reserves
Other Canadian investment abroad
Loans
Currency and deposits
Trade credits and advances
Other accounts receivable
Net incurrence of liabilities
Direct investment liabilities
Direct investment liabilities, equity
Direct investment liabilities, debt instruments
Foreign portfolio investment in Canadian
securities
Canadian debt securities
Canadian money market instruments
Canadian bonds
Canadian equity and investment fund shares
Other foreign investment in Canada
Loans
Currency and deposits
Special drawing rights
Trade credits and advances
Other accounts payable
Discrepancy (net errors and omissions)
-12,344
-12,329
-5,614
-595
-5,018
-6,241
-504
-5,737
-133
-5,418
-186
-475
-14
-20,784
-20,683
-13,559
-5,404
-8,155
-5,019
-411
-4,608
1,045
-5,486
-167
-2,106
-101
-17,440
-17,438
-14,228
-7,352
-6,876
-3,051
-469
-2,582
3,027
-5,450
-159
-160
-2
-14,437
-14,435
-11,344
-7,773
-3,571
-2,831
-416
-2,415
3,607
-5,512
-511
-260
-2
-13,160
-13,158
-8,268
-3,118
-5,150
-4,145
-398
-3,747
1,398
-5,184
39
-744
-2
-44,495
-44,893
-18,616
4,791
-23,407
-23,664
-2,036
-21,627
-7
-20,779
-841
-2,614
398
-65,821
-65,714
-47,399
-23,646
-23,753
-15,046
-1,694
-13,352
9,077
-21,632
-797
-3,270
-106
-11,502
55,072
34,571
32,439
2,132
-21,932
37,555
18,019
16,839
1,181
-15,109
53,403
40,876
31,109
9,766
-10,771
38,898
34,679
16,317
18,361
-7,403
79,199
10,746
16,380
-5,634
-43,195
147,881
69,424
64,412
5,012
-55,215
209,055
104,319
80,645
23,674
16,052
9,639
774
8,865
6,412
2,161
2,288
7,355
-3,038
-458
-1,572
66,573
22,042
21,832
210
-4,114
-514
-50
-464
-3,600
6,586
17,064
12,871
-2,709
238
6,664
59,488
8,721
5,398
3,323
25,216
10,642
532
10,110
14,574
-1,917
-10,772
-769
-7,253
-36
-2,714
68,512
27,916
24,443
3,473
2,112
1,798
-1,654
3,452
314
2,663
-557
11,166
-4,922
25
-6,824
49,669
35,076
29,176
5,901
37,087
22,946
-268
23,215
14,141
3,580
27,786
-2,505
26,651
-40
3,680
86,602
8,894
22,340
-13,447
56,428
20,622
-88
20,709
35,806
5,854
16,175
26,316
-8,247
-410
-1,484
191,075
72,542
68,115
4,427
60,302
34,873
-1,441
36,314
25,430
10,911
33,522
20,762
11,767
186
806
264,270
80,607
81,357
-751
2,863
6,328
-1,615
7,943
-3,466
41,669
6,712
34,219
0
553
185
46,341
36,876
-13,262
50,137
9,465
4,426
-326
4,185
0
386
180
29,539
24,627
19,617
5,010
4,913
11,056
7,909
3,094
0
-157
210
-969
8,317
-4,421
12,738
-9,286
15,561
2,772
12,246
0
286
258
20,610
11,316
4,124
7,192
9,294
57,098
1,393
55,526
0
-4
184
75,388
50,172
-2,755
52,928
25,216
43,146
2,552
38,205
0
1,730
659
95,522
81,135
6,058
75,078
14,387
88,141
11,748
75,050
0
510
833
842
-1,148
2,331
3,666
5,756
1,300
10,605
1. Transactions are recorded on a net basis.
2. In the financial account, a plus sign denotes an increase in investment and a minus sign denotes a decrease in investment.
Source(s): CANSIM tables 376-0101, 376-0102, 376-0103 and 376-0104.
Component of Statistics Canada catalogue no. 11-001-X
7
The Daily, Monday, February 29, 2016
Table 2
Current account – Seasonally adjusted
Fourth quarter
2014
First quarter
2015
Second quarter
2015
Current account receipts
Goods and services
Goods
Services
Travel
Transportation
Commercial services
Government services
Primary income
Compensation of employees
Investment income
Direct investment
Interest
Profits
Portfolio investment
Interest on debt securities
Dividends on equity and investment fund shares
Other investment
Secondary income
Private transfers
Government transfers
180,485
156,577
132,343
24,235
4,886
3,825
15,140
383
21,144
370
20,774
12,407
1,206
11,200
6,684
1,915
4,769
1,684
2,764
916
1,848
177,548
152,758
128,206
24,552
4,957
3,749
15,456
390
22,220
412
21,808
13,075
1,139
11,935
6,851
1,991
4,861
1,882
2,570
926
1,644
179,858
153,808
129,241
24,566
5,133
3,752
15,275
407
23,333
416
22,918
14,021
1,211
12,810
7,008
2,132
4,876
1,889
2,717
1,089
1,629
Current account payments
Goods and services
Goods
Services
Travel
Transportation
Commercial services
Government services
Primary income
Compensation of employees
Investment income
Direct investment
Interest
Profits
Portfolio investment
Interest on debt securities
Dividends on equity and investment fund shares
Other investment
Secondary income
Private transfers
Government transfers
195,069
163,917
133,924
29,993
9,365
6,283
14,067
278
27,603
887
26,717
12,698
1,029
11,670
12,079
8,601
3,478
1,939
3,549
2,294
1,254
196,352
165,861
135,394
30,467
9,423
6,332
14,444
268
26,464
863
25,601
11,367
1,092
10,275
12,356
8,832
3,524
1,878
4,027
2,232
1,795
Current account balances
Goods and services
Goods
Services
Travel
Transportation
Commercial services
Government services
Primary income
Compensation of employees
Investment income
Direct investment
Interest
Profits
Portfolio investment
Interest on debt securities
Dividends on equity and investment fund shares
Other investment
Secondary income
Private transfers
Government transfers
-14,584
-7,339
-1,582
-5,758
-4,479
-2,458
1,073
105
-6,459
-516
-5,943
-292
178
-469
-5,396
-6,686
1,290
-255
-785
-1,379
594
-18,804
-13,103
-7,188
-5,915
-4,465
-2,583
1,012
121
-4,244
-451
-3,793
1,708
47
1,660
-5,505
-6,841
1,336
4
-1,457
-1,306
-151
Third quarter
2015
Fourth quarter
2015
2014
2015
186,370
159,373
134,265
25,108
5,206
3,846
15,662
394
23,862
430
23,431
13,778
1,278
12,500
7,467
2,273
5,194
2,187
3,135
1,111
2,024
182,330
156,894
131,919
24,975
5,187
3,832
15,552
404
22,860
436
22,424
12,338
1,382
10,956
7,817
2,373
5,445
2,269
2,575
1,017
1,558
721,198
624,593
528,849
95,744
19,296
14,940
59,983
1,525
85,553
1,448
84,105
51,593
3,899
47,694
25,698
7,337
18,361
6,814
11,053
3,553
7,500
726,105
622,832
523,631
99,201
20,483
15,179
61,945
1,595
92,275
1,694
90,582
53,211
5,011
48,200
29,144
8,768
20,376
8,227
10,997
4,143
6,855
196,077
166,574
135,860
30,713
9,495
6,424
14,518
277
26,606
863
25,743
11,149
1,096
10,053
12,484
9,027
3,457
2,109
2,898
2,231
667
201,682
170,344
139,323
31,022
9,336
6,499
14,907
280
27,560
819
26,741
11,042
1,121
9,921
12,916
9,395
3,521
2,782
3,778
2,373
1,405
197,709
167,453
136,701
30,752
9,216
6,333
14,923
280
26,692
843
25,849
10,576
1,150
9,426
13,019
9,525
3,494
2,255
3,565
2,341
1,223
766,091
643,208
524,058
119,150
37,351
24,738
55,956
1,106
109,216
3,484
105,732
51,601
4,285
47,316
46,477
33,017
13,460
7,655
13,666
8,966
4,700
791,819
670,231
547,277
122,954
37,469
25,587
58,792
1,105
107,321
3,388
103,934
44,134
4,459
39,675
50,776
36,780
13,996
9,024
14,267
9,177
5,090
-16,219
-12,766
-6,619
-6,147
-4,362
-2,672
757
130
-3,272
-448
-2,825
2,872
115
2,757
-5,476
-6,896
1,419
-221
-181
-1,143
962
-15,312
-10,972
-5,058
-5,914
-4,130
-2,653
755
114
-3,698
-388
-3,309
2,736
157
2,579
-5,450
-7,123
1,673
-595
-643
-1,261
619
-15,379
-10,558
-4,782
-5,777
-4,028
-2,500
628
124
-3,831
-407
-3,425
1,762
232
1,530
-5,201
-7,153
1,951
15
-989
-1,324
335
-44,893
-18,616
4,791
-23,407
-18,055
-9,798
4,027
419
-23,664
-2,036
-21,627
-7
-386
378
-20,779
-25,680
4,901
-841
-2,614
-5,413
2,799
-65,714
-47,399
-23,646
-23,753
-16,986
-10,408
3,153
489
-15,046
-1,694
-13,352
9,077
552
8,526
-21,632
-28,012
6,380
-797
-3,270
-5,034
1,765
millions of dollars
Source(s): CANSIM tables 376-0101 and 376-0105.
8
Component of Statistics Canada catalogue no. 11-001-X
The Daily, Monday, February 29, 2016
Available in CANSIM: tables 376-0012, 376-0013, 376-0101 to 376-0108, 376-0110, 376-0111 and
376-0121 to 376-0124.
Definitions, data sources and methods: survey numbers 1534, 1535, 1536 and 1537.
The document "Revisions to Canada's Balance of International Payments," which is part of Latest
Developments in the Canadian Economic Accounts (13-605-X), is available from the Browse by key resource
module of our website under Publications.
For more information, contact us (toll-free 1-800-263-1136; 514-283-8300;
STATCAN.infostats-infostats.STATCAN@canada.ca).
To enquire about the concepts, methods or data quality of this release, contact Denis Caron (613-808-2278;
denis.caron@canada.ca), International Accounts and Trade Division.
Component of Statistics Canada catalogue no. 11-001-X
9