Special Report: The Importance of Canadian Trade
- Keywords:
- usmca
- canadian trade
America is running a record $900 billion deficit in goods trade. China accounts for the largest share of the shortfall at 44.6%, followed by Mexico’s 10.8%, Japan’s 7.9% and Germany’s 7.6%. Canada weighs in at 2.5% (10th), lifting the NAFTA share to 13.3%, which still falls under the total EU (20.0%). Indeed, China and the EU have accounted for the vast majority of the deterioration in the goods trade deficit since the shortfall hit its post-recession low in early 2010.
Bilateral trade balances by themselves say little about the importance of trade for the U.S. economy—it’s the underlying trade flows that matter. For example, you can have two similar-sized deficits but one shortfall reflects lots of exports and imports (the latter obviously being larger) and the other reflects a lopsided situation of mostly imports with few exports. The former trade pattern would be more beneficial than the latter in terms of production and jobs tied to exports.
View important Disclosure Statements at economics.bmo.com/en/disclosure
Read more
Michael Gregory, CFA
Deputy Chief Economist & Managing Director
Michael is part of the team responsible for forecasting and analyzing the North American economy and financial markets. He has spent his career working in either ec…(..)
View Full Profile >America is running a record $900 billion deficit in goods trade. China accounts for the largest share of the shortfall at 44.6%, followed by Mexico’s 10.8%, Japan’s 7.9% and Germany’s 7.6%. Canada weighs in at 2.5% (10th), lifting the NAFTA share to 13.3%, which still falls under the total EU (20.0%). Indeed, China and the EU have accounted for the vast majority of the deterioration in the goods trade deficit since the shortfall hit its post-recession low in early 2010.
Bilateral trade balances by themselves say little about the importance of trade for the U.S. economy—it’s the underlying trade flows that matter. For example, you can have two similar-sized deficits but one shortfall reflects lots of exports and imports (the latter obviously being larger) and the other reflects a lopsided situation of mostly imports with few exports. The former trade pattern would be more beneficial than the latter in terms of production and jobs tied to exports.
View important Disclosure Statements at economics.bmo.com/en/disclosure
This is part 1
of a
5-part series on
The economic and regulatory landscape facing U.S. businesses wanting to expand into Canada
PART 2
Discover Efficiencies with Expansion into Canada
Oscar Johnson | November 06, 2019 Doing Business In Canada, Manage Cash Flow
We’ve worked with many U.S. businesses that have expanded into Canada, so we’ve seen firsthand the difficulties that crop up when it come…
PART 3
With or Without USMCA, Canada Can Open Doors for US Companies
David Jacobson | November 13, 2019 Doing Business In Canada
There is great debate in Washington about whether Congress will ratify the United States-Mexico-Canada Agreement (USMCA) before year’s end. I h…
PART 4
Making It in Canada: Opportunities and Risks for Manufacturers
Ray Whitacre | November 19, 2019 Doing Business In Canada, Manufacturing
For U.S.-based manufacturing companies looking to expand into international markets, Canada represents a logical entry point. From the nature of its …
PART 5
Looking to Expand into Canada? Tips from our Cross Border Experts
November 04, 2019 Doing Business In Canada
Our cross border campaign, Expertise in Action, offers tips and insights for U.S.-based companies that are looking to expand their businesses no…
Tell us three simple things to
customize your experience.
