Analysis Of Balance Of Payment Of Canada Economics Essay

A balance of payments ( BOP ) sheet is an accounting record of all pecuniary minutess between a state and the remainder of the universe. These minutess include payments for the state ‘s exports and imports of goods, services, and fiscal capital, every bit good as fiscal transportations. The BOP summarizes international minutess for a specific period, normally a twelvemonth, and is prepared in a individual currency, typically the domestic currency for the state concerned. Beginnings of financess for a state, such as exports or the grosss of loans and investings, are recorded as positive or excess points. Uses of financess, such as for imports or to put in foreign states, are recorded as a negative or shortage point.

When all constituents of the BOP sheet are included it must equilibrate – that is, it must sum to zero – there can be no overall excess or shortage. For illustration, if a state is importing more than it exports, its trade balance will be in shortage, but the deficit will hold to be counter balanced in other ways – such as by financess earned from its foreign investings, by running down militias or by having loans from other states

The Balance of Payments consists of three chief subdivisions:

Current Account ( CA )

The current history ( CA ) of the BOP is a record of the trade in goods, in services, and of one-sided transportations between a state and the remainder of the universe.

Merchandise histories contains trade in goods. Net ware exports is frequently called the Balance of Trade.

Trade in services or ‘invisibles ‘ :

Labour services ( e.g. confer withing ) , insurance, travel and banking, renting fees.

Dividends and involvement income ( from “ leasing of money ” )

Unilateral transportations:

Payments made abroad or received from abroad for which there is no corresponding international flow of goods or services. Examples: development assistance, gifts, and rewards repatriated by foreign workers.

Capital Account ( KA )

The capital history is a record of the inward and outward investing and amortisation flows between a state and the remainder of the universe. The capital minutess recorded include those that result from the purchase or sale of existent or fiscal assets. This history includes following secondary histories:

Direct investing

Portfolio investing

Derivative fiscal instruments

Official Militias Account

Official militias include gold, authorities retentions of foreign currencies ( largely in the signifier of commercial paper, T-bills, and bonds ) , money deposited at the IMF, and Special Drawing Rights ( SDRs ) with the I.M.F.

Entries in Bop: Increases if RFX are a usage of financess, lessenings of RFX are a beginning of financess.

Statistical Discrepancy / Errors and Omissions

aˆ? Differences in the timing between the day of the month on which a dealing takes topographic point and the day of the month on which it is recorded.

aˆ? Estimating points such as outgo on travel and

aˆ? Illegal or unreported minutess

a?†RFX = CAestimate + KAestimate + E & A ; O

Balance Of Payments

Beginnings Uses Balance Account

( Beginnings Minus Uses )

1. Current Minutess

aˆ? Exports Of Goods aˆ? Imports Of Goods aˆ? Trade Balance,

aˆ? Exports Of Services aˆ? Imports Of Services aˆ? ‘Invisibles ‘ Balance,

aˆ? Inward Unilateral aˆ? Outward Unilateral aˆ? Net Inward Transfers,

Transportations Transportations

aˆ? Private aˆ? Private

aˆ? Public aˆ? Public

CA = Current Account Balance

= Net Inflow From

Current Minutess

2. Capital Minutess

aˆ? Inward Portfolio aˆ? Outward Portfolio aˆ? Net Inward Investment

Investing Investing

aˆ? Short Term aˆ? Short Term

aˆ? Long Term aˆ? Long Term

aˆ? Inward Direct aˆ? Outward Direct aˆ? Net Inward Investment

Investing Investing

KA = Capital Account Balance

= Net Inflow From

Capital Minutess

3. Central Bank Transactions And Errors And Omissions

aˆ?Decreases In Reserves aˆ? Increases In Reserves aˆ? Net Decreases In Reserves,

( – ) a?†RFX

aˆ?Unrecorded Inflows aˆ? Unrecorded Outflows aˆ? Net Mistakes And Omissions

( E & A ; O )

Grand Total of BOP: 0= CA + KA – a?†RFX + E & A ; O

ABOUT CANADA:

A land of huge distances and rich natural resources, Canada became a autonomous rule in 1867 while retaining ties to the British Crown. Economically and technologically the state has developed in analogue with the US, its neighbor to the south across an unfortified boundary line. Canada faces the political challenges of run intoing public demands for quality betterments in wellness attention and instruction services, every bit good as reacting to separatist concerns in preponderantly francophone Quebec. Canada besides aims to develop its diverse energy resources while keeping its committedness to the environment.

Capital City: Ottawa ( -5 GMT )

Currency: Canadian dollar ( CAD ) ( convert )

Languages: English ( official ) 58.8 % , French ( official ) 21.6 % , other 19.6 %

Naming Code: 1

Voltage: 120

Religions: Roman Catholic 42.6 % , Protestant 23.3 % ( including United Church 9.5 % , Anglican 6.8 % , Baptist 2.4 % , Lutheran 2 % ) , other Christian 4.4 % , Muslim 1.9 % , other and unspecified 11.8 % , none 16 %

Main Airports

Calgary ( YYC ) , Montreal ( YUL ) , Ottawa ( YOW )

U.S. Embassy

Ottawa, Ontario, Canada

Tel: 613.688.5335

hypertext transfer protocol: //canada.usembassy.gov/content/index.asp

Canada: Statistics

Economy:

GDP – buying power para:

$ 1.29 trillion ( 2009 est. )

GDP – existent growing rate:

-2.40 % ( 2009 est. )

GDP – per capita: buying power parity:1

$ 39,078.00 ( 2008 est. )

GDP – composing by sector:2

agribusiness: 2.10 %

industry: 31.20 %

fabrication: 16.50 %

services: 66.70 %

( 2003 est. )

Industrial production growing rate:

-8.00 % ( 2009 est. )

Household income or ingestion by per centum share:1

Lowest 10 % : NA %

lowest 20 % : NA %

2nd 20 % : NA %

3rd 20 % : NA %

4th 20 % : NA %

highest 10 % : NA %

highest 20 % : NA %

Inflation rate ( consumer monetary values ) :

0.20 % ( 2009 est. )

Labour force:

18.40 million ( 2009 est. )

Unemployment rate:

8.50 % ( 2009 est. )

Budget:

Grosss: $ 514.50 billion

outgos: $ 547.20 billion

( 2009 est. )

Exports:

$ 298.50 billion ( 2009 est. )

Exports – spouses:

US 77.7 % , UK 2.7 % , Japan 2.3 % ( 2008 )

Imports:

$ 305.20 billion ( 2009 est. )

Imports – spouses:

US 52.4 % , China 9.8 % , Mexico 4.1 % ( 2008 )

Debt – external:

$ 833.80 billion ( 2009 est. )

Distribution of Family Income – GINI Index:

32.10 % ( 2009 est. )

Electricity Production:

620.70 billion KWh ( 2009 est. )

Electricity Consumption:

536.10 billion KWh ( 2009 est. )

Electricity Exports:

55.73 billion KWh ( 2009 est. )

Electricity Imports:

23.50 billion KWh ( 2009 est. )

Oil Production:

3.35 million bbl/day ( 2009 est. )

Oil Consumption:

2.26 million bbl/day ( 2009 est. )

Oil Exports:

2.42 million bbl/day ( 2009 est. )

Oil Imports:

1.17 million bbl/day ( 2009 est. )

Oil Proved Militias:

178.10 billion Bbl ( 2009 est. )

Natural Gas Production:

170.90 billion coppers m ( 2009 est. )

Natural Gas Consumption:

82.93 billion coppers m ( 2009 est. )

Natural Gas Exports:

102.80 billion coppers m ( 2009 est. )

Natural Gas Imports:

14.84 billion coppers m ( 2009 est. )

Natural Gas Proved Militias:

1.64 trillion coppers m ( 2009 est. )

RISK ASSESSMENT:

State Rating

Rating: A2

Business Climate Rating

Rating: A1

Peoples:

Population:

33.49 million ( 2009 est. )

Population growing rate:

0.82 % ( 2009 est. )

Population below Poverty Line:

10.00 % ( 2009 est. )

Infant mortality rate:

5.04 deaths/1,000 unrecorded births ( 2009 est. )

Life anticipation at birth:1

Entire population: 79.76 old ages

male: 77.00 old ages

female: 82.66 old ages

( 2004 est. )

Entire birthrate rate:

1.58 kids born/woman ( 2009 est. )

Cultural groups:

British Isles origin 28 % , Gallic origin 23 % , other European 15 % , Amerindian 2 % , other, largely Asiatic, African, Arab 6 % , assorted background 26 %

Nationality:

Noun: Canadian ( s ) adjective: Canadian

Religions:

Roman Catholic 42.6 % , Protestant 23.3 % ( including United Church 9.5 % , Anglican 6.8 % , Baptist 2.4 % , Lutheran 2 % ) , other Christian 4.4 % , Muslim 1.9 % , other and unspecified 11.8 % , none 16 % ( 2001 nose count )

Languages:

English ( official ) 58.8 % , French ( official ) 21.6 % , other 19.6 % ( 2006 Census )

Literacy:

Entire population: NA %

male: NA %

female: NA %

HIV/AIDS – Adult Prevalence Rate:

0.40 ( 2009 est. )

Geography:

Location:

Northern North America, surrounding the North Atlantic Ocean on the E, North Pacific Ocean on the West, and the Arctic Ocean on the North, North of the contiguous United states

Area:

Entire: 9.98 million sq kilometer

land: 9.09 million sq kilometer

H2O: 891,163.00 sq kilometer

Land boundaries:

entire: 8,893.00 kilometer

boundary line states: US 8,893 kilometer ( includes 2,477 kilometer with Alaska )

Coastline:

202,080.00 kilometer

Climate:

Varies from temperate in south to subarctic and north-polar in north

Terrain:

Largely plains with mountains in West and Lowlandss in sou’-east

Elevation extremes:

Lowest point: Atlantic Ocean 0 m

highest point: Mount Logan 5,959 m

Environment – International Agreements:

Party to: Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-Persistent Organic Pollutants, Air Pollution-Sulphur 85, Air Pollution-Sulphur 94, Antarctic-Environmental Protocol, Antarctic-Marine Living Resources, Antarctic Seals, Antarctic Treaty, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Environmental Modification, Hazardous Wastes, Law of the Sea, Marine Dumping, Ozone Layer Protection, Ship Pollution, Tropical Timber 83, Tropical Timber 94, Wetlands signed, but non ratified: Air Pollution-Volatile Organic Compounds, Marine Life Conservation

International Organization Engagement:

ACCT, ADB ( non regional member ) , AFDB ( non regional member ) , APEC, Arctic Council, ARF, ASEAN ( dialogue spouse ) , Australia Group, BIS, C, CDB, CE ( observer ) , EAPC, EBRD, ESA ( collaborating province ) , FAO, G-20, G-7, G-8, G-10, IADB, IAEA, IBRD, ICAO, ICC, ICCT, ICRM, IDA, IEA, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, IMSO, Interpol, IOC, IOM, IPU, ISO, ITSO, ITU, ITUC, MIGA, MINUSTAH, MONUC, NAFTA, NATO, NEA, NSG, OAS, OECD, OIF, OPCW, OSCE, Paris Club, PCA, PIF ( spouse ) , SECI ( observer ) , UN, UNCTAD, UNDOF, UNESCO, UNFICYP, UNHCR, UNMIS, UNRWA, UNTSO, UNWTO, UPU, WCL, WCO, WFTU, WHO, WIPO, WMO, WTO, ZC

Technology:

Telephones:

18.25 million ( 2009 est. )

Cellular Telephones:

21.46 million ( 2009 est. )

Internet Country Code:

.ca

Internet Hosts:

7.19 million ( 2009 est. )

ISPs:

760.00 ( 2009 est. )

Internet Users:

25.09 million ( 2009 est. )

Railwaies:

46,688.00 ( 2009 est. )

Highwaies:

1.04 million ( 2009 est. )

Airports:

1,388.00 ( 2009 est. )

Canada: Economy

As an flush, hi-tech industrial society in the trillion-dollar category, Canada resembles the US in its market-oriented economic system, form of production, and flush life criterions. Since World War II, the impressive growing of the fabrication, excavation, and service sectors has transformed the state from a mostly rural economic system into one chiefly industrial and urban. The 1989 US-Canada Free Trade Agreement ( FTA ) and the 1994 North American Free Trade Agreement ( NAFTA ) ( which includes Mexico ) touched off a dramatic addition in trade and economic integrating with the US, its principle trading spouse. Canada enjoys a significant trade excess with the US, which absorbs about 80 % of Canadian exports each twelvemonth. Canada is the US ‘s largest foreign provider of energy, including oil, gas, U, and electric power. Given its great natural resources, skilled labour force, and modern capital works, Canada has enjoyed solid economic growing, and prudent financial direction has produced back-to-back balanced budgets from 1997 to 2007. In 2008, growing slowed aggressively as a consequence of the planetary economic downswing, US lodging slack, immersing car sector demand, and a bead in universe trade good monetary values. Public fundss, excessively, are set to deteriorate for the first clip in a decennary. Tight planetary recognition conditions have further restrained concern and lodging investing, despite the conservative loaning patterns and strong capitalisation that made Canada ‘s major Bankss among the most stable in the universe.

Canada: Trade Statistics

Exports AND IMPORTS OF GOODS:

Balance of International Payments

Following Revision: May 2010

Canada with the World

Beginning: Statistics Canada CANSIM database

( Million Dollars )

2002

2003

2004

2005

2006

2007

2008

2009

Exports of goods

4,14,039

3,99,122

4,29,006

4,50,210

4,53,951

4,63,127

4,89,857

3,69,633

Agricultural and fish merchandises

30,873

29,234

30,675

30,097

31,211

34,421

40,858

37,271

Energy merchandises

49,330

60,521

68,106

86,920

86,801

91,293

1,25,792

79,687

Forestry merchandises

37,246

34,519

39,417

36,447

33,443

29,267

25,659

19,515

Industrial goods and stuffs

70,174

66,806

77,953

84,201

94,207

1,04,792

1,11,511

79,340

Machinery and equipment

97,091

88,676

91,106

93,005

93,253

93,431

92,994

80,524

Automotive merchandises

96,676

87,385

90,389

87,994

82,298

77,306

61,083

43,785

Other consumer goods

17,679

17,187

17,267

17,148

17,811

18,737

18,170

17,942

Particular minutess

8,233

7,689

7,985

8,288

8,732

8,176

8,193

6,399

Other Balance of Payments accommodations

6,737

7,106

6,108

6,110

6,194

5,704

5,597

5,169

A

Imports of goods

3,56,727

3,42,710

3,63,158

3,87,838

4,04,345

4,15,229

4,42,988

3,73,968

Agricultural and fish merchandises

21,780

21,508

21,399

22,041

23,456

25,526

28,511

29,337

Energy merchandises

16,567

19,813

24,782

33,660

34,705

36,749

53,072

33,915

Forestry merchandises

3,138

3,008

3,172

3,133

3,084

2,994

2,869

2,387

Industrial goods and stuffs

68,891

65,272

73,511

78,547

83,945

85,085

91,574

74,934

Machinery and equipment

1,05,947

98,684

1,04,091

1,10,931

1,14,736

1,16,674

1,22,628

1,07,903

Automotive merchandises

81,469

76,492

77,368

78,381

79,845

79,948

71,959

55,273

Other consumer goods

46,474

46,306

47,719

49,484

52,007

54,781

57,522

57,454

Particular minutess

5,974

5,310

4,967

4,650

4,775

5,209

6,001

4,655

Other Balance of Payments accommodations

6,487

6,318

6,149

7,011

7,793

8,262

8,852

8,109

Exports AND IMPORTS OF COMMERICAL SERVICES BY CATEGORY:

Balance of International Payments

Canada with the World

Beginning: Statistics Canada CANSIM database

( Million Dollars )

A

A

A

2002

2003

2004

2005

2006

2007

2008

Entire Services Receipts ( Exports )

63,483

61,781

65,381

67,599

68,669

69,637

70,478

Commercial Servicess:

34,246

35,513

35,765

37,439

38,395

39,627

39,974

Communicationss services

2,362

2,372

2,440

2,371

2,407

2,383

2,446

Telecommunication services

1,473

1,463

1,490

1,373

1,390

1,444

n.a.

Construction services

157

133

166

220

283

328

266

Insurance services

5,090

4,809

4,145

3,890

3,826

4,044

3,816

Other fiscal services

1,528

1,604

1,465

2,362

2,927

3,460

3,315

Computer and information services

3,557

3,910

3,912

4,358

4,871

4,918

4,925

Computer services

3,168

3,464

3,544

3,794

3,882

3,900

4,074

Information services

389

446

368

564

989

1,018

851

Royalties and license fees

3,917

3,930

3,907

3,348

3,599

3,746

3,644

Patents and industrial design

1,639

1,599

1,546

1,219

1,170

1,276

1,315

Hallmarks

84

137

120

112

174

140

132

Franchises

18

19

2

134

154

109

90

Copyrights and related rights

202

281

470

154

125

153

184

Software and other royalties

1,973

1,894

1,770

1,729

1,976

2,068

1,922

Non-financial committees

739

893

685

859

747

999

1,074

Equipment leases

397

411

354

524

512

515

504

Management services

4,740

5,236

5,328

5,244

5,228

5,162

5,571

Legal services

456

505

595

638

631

790

759

Other direction services

4,285

4,731

4,734

4,606

4,597

4,372

4,812

Ad and related services

549

471

492

607

587

692

616

Research and development

2,519

3,249

3,297

3,192

3,251

3,315

3,208

Architectural, technology, and other proficient services

4,075

3,916

4,410

4,917

4,220

4,571

4,912

Architectural and technology services

3,006

2,848

2,912

3,312

2,789

2,887

3,028

Other proficient services

1,068

1,068

1,497

1,605

1,432

1,684

1,884

Environmental services

403

333

368

429

297

284

n.a.

Assorted services to concern

2,621

2,601

2,776

3,042

3,344

3,091

3,190

Assorted concern services

2,071

2,190

2,288

2,637

2,846

2,669

2,835

Tooling and other assorted services

550

410

488

405

498

422

355

Audio-visual services

1,786

1,761

2,160

2,275

2,352

2,162

2,235

Personal, cultural and recreational services

209

217

230

229

242

242

251

A

A

A

A

A

A

A

A

A

A

A

A

A

2002

2003

2004

2005

2006

2007

2008

Entire Services Payments ( imports )

70,707

73,302

76,417

79,654

82,607

88,611

92,977

Commercial Servicess:

36,903

39,109

39,284

39,231

39,653

41,120

41,484

Communicationss services

2,305

2,049

2,143

1,803

1,821

2,041

2,066

Telecommunication services

1,485

1,232

1,365

991

1,034

1,112

n.a.

Construction services

92

119

191

211

117

229

240

Insurance services

6,612

6,900

6,127

6,065

6,183

6,553

6,315

Other fiscal services

2,711

2,729

2,804

3,306

4,189

4,369

3,981

Computer and information services

2,045

2,278

2,210

2,180

2,306

2,674

2,337

Computer services

1,378

1,511

1,543

1,540

1,628

1,761

1,721

Information services

668

766

668

641

679

913

616

Royalties and license fees

7,038

7,830

8,548

8,360

7,914

8,768

9,363

Patents and industrial design

3,760

4,377

4,330

4,603

3,788

3,895

4,259

Hallmarks

719

866

1,248

1,313

1,512

1,659

1,706

Franchises

442

410

501

699

844

1,010

979

Copyrights and related rights

547

708

1,054

374

363

386

445

Software and other royalties

1,570

1,469

1,415

1,371

1,407

1,817

1,974

Non-financial committees

634

772

562

653

627

644

624

Equipment leases

704

859

817

1,071

1,056

1,307

1,386

Management services

4,780

5,210

5,517

5,499

5,328

4,787

5,302

Legal services

595

657

633

690

699

685

881

Other direction services

4,185

4,553

4,884

4,809

4,629

4,102

4,421

Ad and related services

518

548

478

437

393

359

379

Research and development

989

1,148

1,375

1,313

1,257

1,217

1,153

Architectural, technology, and other proficient services

2,151

2,522

2,409

2,319

2,565

2,824

2,872

Architectural and technology services

1,109

1,333

1,424

1,341

1,349

1,366

1,422

Other proficient services

1,041

1,189

985

978

1,216

1,459

1,450

Environmental services

361

429

406

459

326

371

n.a.

Assorted services to concern

3,817

3,745

3,709

3,790

3,555

3,002

3,018

Assorted concern services

1,259

1,329

1,581

1,923

1,981

1,873

1,935

Tooling and other assorted services

2,558

2,416

2,128

1,867

1,574

1,130

1,084

Audio-visual services

2,322

2,208

2,193

2,019

2,135

2,139

2,226

Personal, cultural and recreational services

185

192

202

206

207

207

221

Canada: Balance OF PAYMENT ACCOUNT

CURRENT ACCOUNT Table:

Balance of International Payments

Following Revision: May 2010

Canada with the World

Beginning: Statistics Canada CANSIM database

( Million Dollars )

Grosss

2002

2003

2004

2005

2006

2007

2008

2009

A

Entire current history

A

5,14,913

4,96,899

5,39,637

5,75,612

5,98,265

6,18,798

6,42,324

5,02,820

A

Goods and services

A

4,77,522

4,60,903

4,94,387

5,17,809

5,22,620

5,32,763

5,60,335

4,36,284

Goods

4,14,039

3,99,122

4,29,006

4,50,210

4,53,951

4,63,127

4,89,857

3,69,633

A

Servicess

A

63,483

61,781

65,381

67,599

68,669

69,637

70,478

66,651

A

Travel

A

16,741

14,776

16,980

16,674

16,610

16,468

16,119

15,592

A

Transportation system

A

11,060

9,942

11,040

11,777

11,862

11,881

12,598

10,501

A

Commercial services

A

34,246

35,513

35,765

37,439

38,395

39,627

39,974

38,682

A

Government services

A

1,435

1,551

1,596

1,709

1,802

1,660

1,787

1,876

A

Investing income

A

30,502

29,253

38,095

49,768

66,086

76,546

71,667

57,806

A

Direct investing income

A

13,766

13,706

21,179

27,579

36,646

41,884

37,590

29,916

A

Portfolio investing income

A

8,859

8,654

10,070

12,373

17,308

22,066

22,198

20,380

A

Other investing income

A

7,877

6,893

6,846

9,816

12,131

12,596

11,880

7,510

A

Current transportations

A

6,890

6,743

7,155

8,035

9,559

9,489

10,322

8,730

Payments

2002

2003

2004

2005

2006

2007

2008

2009

A

Entire current history

A

4,95,135

4,82,250

5,09,800

5,49,710

5,77,932

6,03,192

6,34,209

5,44,123

A

Goods and services

A

4,27,434

4,16,011

4,39,575

4,67,492

4,86,952

5,03,840

5,35,965

4,63,200

Goods

3,56,727

3,42,710

3,63,158

3,87,838

4,04,345

4,15,229

4,42,988

3,73,968

A

Servicess

A

70,707

73,302

76,417

79,654

82,607

88,611

92,977

89,233

A

Travel

A

18,401

18,727

20,237

21,865

23,402

26,511

28,734

27,759

A

Transportation system

A

14,438

14,509

15,919

17,537

18,509

19,842

21,590

19,414

A

Commercial services

A

36,903

39,109

39,284

39,231

39,653

41,120

41,484

40,885

A

Government services

A

965

956

977

1,020

1,042

1,137

1,170

1,175

A

Investing income

A

60,799

59,284

62,399

72,685

79,993

87,880

86,891

70,022

A

Direct investing income

A

21,529

23,765

27,673

36,042

36,479

39,830

40,001

29,011

A

Portfolio investing income

A

30,804

28,816

27,964

28,165

29,074

30,999

31,981

33,045

A

Other investing income

A

8,466

6,702

6,762

8,477

14,440

17,051

14,908

7,966

A

Current transportations

A

6,902

6,955

7,825

9,533

10,987

11,473

11,353

10,900

Balances

2002

2003

2004

2005

2006

2007

2008

2009

A

Entire current history

A

19,778

14,649

29,837

25,902

20,333

15,606

8,115

-41,303

A

Goods and services

A

50,088

44,892

54,811

50,317

35,668

28,924

24,370

-26,917

Goods

57,311

56,413

65,848

62,372

49,606

47,898

46,869

-4,334

A

Servicess

A

-7,224

-11,521

-11,037

-12,055

-13,937

-18,974

-22,499

-22,582

A

Travel

A

-1,659

-3,951

-3,257

-5,191

-6,792

-10,043

-12,615

-12,167

A

Transportation system

A

-3,378

-4,567

-4,879

-5,760

-6,647

-7,961

-8,992

-8,912

A

Commercial services

A

-2,657

-3,596

-3,518

-1,792

-1,258

-1,493

-1,510

-2,203

A

Government services

A

470

594

618

688

760

522

618

701

A

Investing income

A

-30,297

-30,031

-24,304

-22,917

-13,907

-11,334

-15,223

-12,216

A

Direct investing income

A

-7,763

-10,059

-6,494

-8,464

167

2,054

-2,411

905

A

Portfolio investing income

A

-21,945

-20,163

-17,894

-15,792

-11,765

-8,933

-9,783

-12,665

A

Other investing income

A

-589

191

84

1,339

-2,309

-4,455

-3,029

-456

A

Current transportations

A

-12

-212

-670

-1,498

-1,429

-1,984

-1,031

-2,171

Capital AND FINANCIAL ACCOUNT Table:

Capital and Financial Account ; Table 376-0002

A

A

A

A

A

A

A

A

A

A

A

A

A

A

A

A

A

A

A

2002

2003

2004

2005

2006

2007

2008

2009

Entire capital and fiscal history, cyberspace flows

-17,208

-15,711

-32,809

-23,350

-22,552

-19,562

-7,122

43,309

Capital history, cyberspace flows

A

4,936

4,225

4,437

5,905

4,288

4,258

4,520

4,117

Fiscal history, cyberspace flows

A

-22,144

-19,935

-37,246

-29,255

-26,840

-23,819

-11,641

39,192

Canadian assets, cyberspace flows

A

-83,631

-67,724

-87,065

-1,10,460

-1,64,630

-1,75,676

-1,03,533

-1,03,872

Canadian direct investing abroad

A

-42,015

-32,118

-56,395

-33,370

-50,367

-64,056

-82,874

-46,297

Canadian portfolio investing

A

-29,319

-19,054

-24,369

-53,455

-78,668

-48,426

13,652

-8,667

Canadian portfolio investing, foreign bonds

A

-6,229

-7,974

-15,290

-29,488

-43,761

-28,902

16,354

9,030

Canadian portfolio investing, foreign stocks

A

-21,253

-7,699

-8,092

-21,878

-28,107

-30,946

-7,914

-15,850

Canadian portfolio investing, foreign money market

-1,837

-3,381

-987

-2,089

-6,800

11,422

5,212

-1,847

Other Canadian investing

A

-12,297

-16,553

-6,300

-23,635

-35,595

-63,194

-34,311

-48,908

Other Canadian investing, loans

A

-8,587

7,614

3,444

7,325

-11,819

-10,237

-626

-17,412

Other Canadian investing, sedimentations

A

5,844

-19,286

-10,661

-15,817

-9,002

-42,202

-37,227

-16,908

Official international militias

A

298

4,693

3,427

-1,653

-1,013

-4,644

-1,711

-11,618

Other assets

A

-9,851

-9,574

-2,510

-13,489

-13,761

-6,111

5,253

-2,970

Canadian liabilities, cyberspace flows

A

61,487

47,789

49,819

81,205

1,37,790

1,51,857

91,891

1,43,064

Foreign direct investing in Canada

A

34,769

10,483

-579

31,132

67,791

1,16,448

47,710

22,092

Foreign portfolio investing

A

18,599

19,714

54,550

13,136

31,388

-31,590

29,057

1,09,367

Foreign portfolio investing, Canadian bonds

A

18,297

7,870

19,238

3,481

16,863

11,548

15,179

82,500

Foreign portfolio investing, Canadian stocks

A

-1,531

13,491

35,742

9,133

10,814

-41,994

2,746

26,202

Foreign portfolio investing, Canadian money market

1,833

-1,646

-429

522

3,711

-1,143

11,132

665

Other liabilities

A

8,119

17,592

-4,152

36,937

38,611

66,999

15,124

11,605

Government of Canada demand liabilities

A

11

-253

-103

-127

-68

-71

360

-384

Short-run payables to non-residents

A

593

-1,607

280

1,443

484

-834

581

-128

Liabilitiess other than Government demand liabilities and short-run payables to non-residents

-7,449

-1,043

-1,766

678

107

6,255

-2,397

9,927

Statistical disagreement and Inter-area transportations

-2,570

1,062

2,973

-2,552

2,220

3,955

-994

-2,006

CANADA ‘S Performance: Analysis

The current history records the flow of minutess between Canada and its commercial spouses. The largest constituent of these minutess comprises the exchange of goods and services. The staying two constituents of the current history gaining control the flow of payments and grosss of investing income and current transportations.

CURRENT ACCOUNT BALANCE:

Canada has surplus current history balance from 2002 to 2008 and is declined every twelvemonth from 2004 and go shortage in 2009.

Deficit balance of -41,303 million dollars in 2009 while it has 8,115 million dollars excess balance in 2008.

GOODS AND SERVICES:

There was uninterrupted worsening in trade balance from 2005 to 2009 twelvemonth.

Canada ‘s exports of goods and services less than imports in 2009.

Canada exported 4,36,284 million dollars deserving of goods and services in 2009 compared to 5,60,335 million dollar in 2008 which is lower by -1,24,051.

Imported 4,63,200 million dollar worth of goods and services is less than old twelvemonth imports but it is greater than exports in 2009.

Canada has a shortage balance of 26,917 million dollars of goods and services in 2009.

Servicess have more shortage balance than goods which is -22,582 in instance of services and -4,334 million dollars in instance of goods in current history in 2009.

INVESTMENT INCOME AND CURRENT TRANSFERS BALANCE:

There was a little betterment in the investing income shortage, as it narrowed by 3,007 to -12,216 million dollars in 2009.

Direct investing income has a excess balance of 905 million dollars while it has shortage balance in old twelvemonth that is -2,411 million dollars in 2008.

There was addition in shortage of Portfolio investing income by 2882 million dollars to -12,665 million dollars.

There was another lessening in other income investing shortage by 2573 million dollars to -456 million dollars in 2009 while it was increased in 2007 and thenceforth go worsening.

Increase in current transportation ‘s shortage to -2171 million dollars by 1140 million dollars in 2009.

Main factors which caused a current history shortage in the balance of Payments:

Canada has run current history shortages because the investing chances in the state have far exceeded the nest eggs of Canadian occupants. As a consequence at that place has been a net capital influx which, by seting upward force per unit area on domestic aggregative demand, has caused the existent exchange rate to be sufficiently high to make an surplus of imports over exports precisely equal to the net capital influx plus the debt service shortage. The coveted excess of imports over exports must be equal to the net capital influx plus the debt service shortage as a status of domestic existent goods market equilibrium.

There has been a debt service shortage because a considerable fraction of the capital employed in Canada is owned either straight or indirectly by aliens — aliens ‘ net incomes on this capital must be repatriated abroad every twelvemonth.

Economic crisis:

India ‘s trading spouses experienced negative economic growing so they bought less of our exports, declining the current history.

Inflation:

Due to lift in monetary values of goods and services makes exports less competitory and imports more competitive.A

Capital History:

Capital AND FINANACIAL ACCOUNT BALANCE:

There was uninterrupted in shortage balance of capital and fiscal history from twelvemonth 2002 to 2008.

In 2004 it has maximal shortage balance that is 32,809 million dollars and from 2004 it becomes worsening in following twelvemonth ‘s.

Canada has surplus balance of history in 2009 is 43,309 million dollars.

Fiscal history balance has contributed app. about 10 times than capital history balance to surplus history balance in 2009 and their parts are 39192 and 4117 million dollars.

FOREIGN DIRECT INVESTMENT:

From 2005 Canada increased its foreign direct investing abroad to 2008 but in 2009, it declined.

Canada has 46,297 million dollar foreign investing in abroad which is less than old twelvemonth from 82,874 million dollars

Addition in direct investing in Canada from 2005 that is 31,132 million dollars.

There was maximal investing in Canada by foreign investors in 2006 and 2007 that is 67,791 and 1,16,448 million dollars and in 2009 it reduces.

The value of direct investing in Canada in 2009 is 22,092 million dollars.

FOREIGN PORTFOLIO INVESTMENT:

2002

2003

2004

2005

2006

2007

2008

2009

-29,319

-19,054

-24,369

-53,455

-78,668

-48,426

13,652

-8,667

-6,229

-7,974

-15,290

-29,488

-43,761

-28,902

16,354

9,030

-21,253

-7,699

-8,092

-21,878

-28,107

-30,946

-7,914

-15,850

-1,837

-3,381

-987

-2,089

-6,800

11,422

5,212

-1,847

2002

2003

2004

2005

2006

2007

2008

2009

18,599

19,714

54,550

13,136

31,388

-31,590

29,057

1,09,367

18,297

7,870

19,238

3,481

16,863

11,548

15,179

82,500

-1,531

13,491

35,742

9,133

10,814

-41,994

2,746

26,202

1,833

-1,646

-429

522

3,711

-1,143

11,132

665

OVER ALL BALANCE OF PAYMENT:

2002

2003

2004

2005

2006

2007

2008

2009

Entire current history

19,778

14,649

29,837

25,902

20,333

15,606

8,115

-41,303

Entire capital and fiscal history, cyberspace flows

-17,208

-15,711

-32,809

-23,350

-22,552

-19,562

-7,122

43,309

So, above figure shows that the overall balance becomes negative in 2006 and 2007 because capital and fiscal history balance has more negative than positive balance of current history but in 2008 and 2009 overall balance becomes positive. In this instance current history balance has more positive balance than negative balance of capital and fiscal history balance.

RELATIONSHIP BETWEEN CURRENT ACCOUNT BALANCE AND SAVING AND INVESTMENTS:

The Relationship between current history balance and salvaging & A ; investing can be derived as follows:

Simple national accounting individualities help to cast visible radiation on the macroeconomic determiners of current history fluctuations. For this intent, it is utile to get down with the definition of a state ‘s gross national merchandise in period T:

[ GNP.sub.t ] = [ Y.sub.t ] + [ r.sub.t ] [ B.sub.t ] ,

where [ Y.sub.t ] is the state ‘s gross domestic merchandise and [ r.sub.t ] [ B.sub.t ] denotes the state ‘s net income from abroad, that is, the ex station return [ r.sub.t ] earned on the stock [ B.sub.t ] of net foreign assets come ining period t. A negative value for [ B.sub.t ] indicates that the sum of outstanding assets a state ‘s domestic occupants ain abroad is less than the sum of outstanding assets aliens own in the state, that is, the state is a net debitor counterpart the remainder of the universe. ( 2 ) Equilibrium in the end product market requires that gross domestic production equal the demand for private sector ingestion, C, authorities disbursement, G, investing, I, and net demand from abroad, NX:

[ Y.sub.t ] = [ C.sub.t ] + [ G.sub.t ] + [ I.sub.t ] + N [ X.sub.t ] .

Net demand from abroad is the surplus of exports over imports, or the trade balance.

From the two old individualities it so follows that the current history, CA, conventionally defined as the amount of the trade balance and net income from abroad, can besides be written as the surplus of gross national merchandise over soaking up: ( 3 )

[ CA.sub.t ] = N [ X.sub.t ] + [ r.sub.t ] [ B.sub.t ] = [ GNP.sub.t ] – ( [ C.sub.t ] + [ G.sub.t ] + [ I.sub.t ] ) . ( 1 )

In add-on, note that the difference between a state ‘s national merchandise and private and authorities ingestion is national nest eggs, that is, the amount of private and authorities nest eggs. As a consequence, the current history is besides equal to the difference between national nest eggs, S, and investing:

[ CA.sub.t ] = [ S.sub.t ] – [ I.sub.t ] . ( 2 )

Sing the current history as net exports ( in a wide sense inclusive of net income from abroad ) or as the difference between nest eggs and investing is tantamount from an accounting position. Motions in involvement rates, exchange rates, monetary values, and income will guarantee that the determinations to export and import and to salvage and put, made at a microeconomic degree by a broad assortment of heterogenous economic agents, will fit in the sum. Still, specifying the current history as the difference between nest eggs and investing is more appropriate when seeking to explicate digesting forms in international capital flows.

The preceding individuality besides highlights the linkages between nest eggs and investing and net international capital flows. Savingss over a period of clip Ts are in fact equal to the alteration in wealth from the beginning to the terminal of period t. Given that a state ‘s wealth at the beginning of period T is given by the amount of its stock of capital, [ K.sub.t ] , and net assets from abroad, [ B.sub.t ] , individuality ( 2 ) can be rewritten as follows: ( 4 )

[ CA.sub.t ] = ( [ B.sub.t+1 ] + [ K.sub.t+1 ] – [ B.sub.t ] – [ K.sub.t ] ) – [ I.sub.t ] = [ B.sub.t+1 ] – [ B.sub.t ] , ( 3 )

where usage has been made of the capital accretion equation [ K.sub.t+1 ] – [ K.sub.t ] = [ I.sub.t ] . The individuality says that the current history over a period of clip T is the alteration in the value of net assets vis-a-vis the remainder of the universe. A net influx occurs when the addition in domestic assets held by aliens exceeds the addition in foreign assets held by domestic occupants. In other footings, if domestic nest eggs are deficient to finance domestic investing, the surplus of investing over nest eggs will be financed by nest eggs from abroad. Therefore, the opposite number of a current history shortage is a net influx of capital into the state that increases the state ‘s net adoption place vis-a-vis the remainder of the universe. Conversely, if domestic nest eggs are greater than domestic investing, the surplus will travel to finance investing abroad. The current history excess will ensue in a net escape of capital from the state that will increase the state ‘s net loaning place vis-a-vis the remainder of the universe.