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Posted by Daniel Workman Feb 15, 2008 |
Canadian exports in December 2007 slipped 3.1% to C$36.7 billion. The stronger Canadian loonie resulted in a slight 0.7% gain in imports to $34.3 billion.
According to Statistics Canada, Canada's trade surplus of $2.4 billion in December represents a nine-year low.
BMO deputy chief economist Doug Porter commented that Canada's current account deficit including investment income and services may have slipped into the red for the final quarter of 2007.
Back in the 1970s, 1980s and early 1990s, government overspending resulted in Canada's current account deficits.
Today, the Canadian economy remains strong while U.S. business weakens.
Canadian exporters are now focusing on other countries around the world. Over the past 3 years, America's share of Canadian exports has fallen from 85% to 75%. Still, Canadian exports are declining across the board.
In December, industrial products declined 6.5%, machinery and equipment sales fell 4.6%. The biggest decrease? Auto exports were down 8.7% to their lowest level in almost a decade.
Only Canadian energy exports experienced an increase.
Should oil prices fall significantly or oil exports falter, Canada's trade balance will slip into deficit.