International Trade Committee on March 1st, 2007

[Art Ridgeway]

It's largely a resource problem. It is a fairly labour-intensive activity. As you've heard, not all countries use exactly the same methodologies.

Once a year, we take our Canadian data and massage it as best we can to be equal in concept to the U.S. data, and then we compare the values.

Given that this is more value to Canada, because their trade with us is a much bigger share of our trade than the other way around, we end up doing most of the work, which is fair because we get more of the benefit.

It is a resource issue at this point to try to do more.

[John Maloney, Liberal, Welland, ON]

Would it be advantageous to Canadian businesses to have that information with the EU or with Japan?

[Art Ridgeway]

To the extent we could improve the data, I guess it would be advantageous to both businesses and policy-makers.

[John Maloney, Liberal, Welland, ON]

How current is your data? Do you have the data for 2006 now? When will you have that?

[Art Ridgeway]

We have the preliminary data, released this morning, for all aspects of the balance of payments, which was handed out for up to the end of 2006. We do it on a quarterly basis, thus it's fairly aggregate data.

Later on, for certain aspects, such as trade in services and foreign direct investment, we are able to produce more detail. We keep the estimates fairly aggregate at this point on the preliminary data because we don't have a full suite of surveys back, but later on we add detail.

We are fairly timely, with about 60 days for the balance of payments.

[John Maloney, Liberal, Welland, ON]

Is there a minimum amount below which you would not record?

[Art Ridgeway]

In principle, there's no minimum amount. I suppose in a practical sense it's difficult to find the very small transactions.

For instance, for imports arriving through the post or courier systems, very low values are estimated at sort of an aggregated group level from the postal system, the courier system, through the exports, and so on. We have general numbers that aren't identified individually, but we have estimates that are included in the data.

[John Maloney, Liberal, Welland, ON]

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Maloney.

Go ahead, Mr. Temelkovski. You have about two and a half minutes.

[Lui Temelkovski, Liberal, Oak Ridges—Markham, ON]

Thank you.

We measure the overall analysis of the trends and figures. I know the government uses them a lot. Private companies use some of the statistics and also not-for-profit groups. Are there fees for this data? Do private companies have to pay fees?

[Craig Kuntz]

It depends. In terms of merchandise trade, we have a cost-recovery program, but we also try to make a vast amount of data available for free.

For instance, all of what we call the HS6, which is the harmonized commodity code data, is available for free on the Industry Canada's Strategis website. We provide that.

Also, all of our publications are free.

When we get to specialized services, things that go beyond what we would normally do or what's available for free, we charge--for example, if people call up and want a tabulation done a particular way to suit their needs, rather than going to the website and getting what's available, or if they want to go down to a very detailed level. For instance, if they come to us and say they want to know about a ten-digit import by mode of transport for particular ports, we would certainly charge them to get at that data, because we would have to have somebody sit down and physically do that special tabulation for them.

If they were going at imports for that six-digit, higher-level family for a province of clearance, they could get it for free.

[Lui Temelkovski, Liberal, Oak Ridges—Markham, ON]

How about for non-profit organizations? I've had one call in the last three years.

[Art Ridgeway]

I don't think there's any particular treatment for non-profits that I'm aware of. There is a special program where we provide additional information to universities and through the school systems for research that's available for free, but I'm not aware of a program particularly aimed at other non-profit institutions.

[Lui Temelkovski, Liberal, Oak Ridges—Markham, ON]

In terms of exchange rates and economies, I understand that exchange rates play a large part in figuring out what the trade surplus and imbalances are.

[Art Ridgeway]

We measure and publish everything in Canadian dollars. Often the transactions are in some other currency, or particularly for foreign direct investment, our assets abroad are often measured in other currencies.

So we translate those into Canadian dollars using current exchange rates. If it's a flow, it's the average for the period. If it's a balance sheet item, we would use the end-of-period exchange rate. For each reporting period, it's always brought back into Canadian dollars to try to make it comparable over time.

[Lui Temelkovski, Liberal, Oak Ridges—Markham, ON]

Do we keep any data in terms of how foreign economies are performing?

[Art Ridgeway]

There's some limited data on other countries on the Stats Canada website. But with the Internet now, you can access data on many other websites around the world. IMF and the OECD have data available on various websites on a wide range of countries or member countries. So this can be accessed fairly readily through the Internet, with tabulations and so on.

[The Chair, Conservative, Leon Benoit]

Mr. Temelkovski, your time is up.

I want to ask a follow-up question to Mr. Maloney's question, as to how current the statistics are.

You say this is fourth quarter 2006, which somewhat contradicts what we were told at an earlier committee meeting. One of the witnesses said that in fact they've only just received the information about services from a specific country for 2003. So there was quite a lag time in terms of getting the information for the particular country that was being talked about. Can you talk about that a bit?

[Art Ridgeway]

Yes. The more detail we get, the longer the lags are, particularly for services and somewhat for foreign direct investment as well. The detailed estimates depend on the annual surveys we conduct. We mail those out after the reference year, and then it often takes up to 18 months to prepare the data, which is a fairly long lag.

One of the reasons for doing this is that we try to utilize as much data as possible from a wide variety of sources to minimize the response burden. Therefore, we have to wait until other data sources become available, so we can use them to put this together.

As I mentioned, some of the accounting information is not readily available, and we find that companies often respond more slowly to our surveys than they do to some of the other surveys, simply because it's more work for them to dig the data out of their system.

So we try to accommodate that by being flexible on how long we give them to respond to the survey. But the detail is slower, yes.

[The Chair, Conservative, Leon Benoit]

Thank you very much.

We'll go now to Monsieur André for five minutes.

[Guy André, Bloc, Berthier—Maskinongé, QC]

Good morning. This is very interesting. I have a few questions for you.

We, the members of the committee, examine all sorts of possibilities regarding bilateral agreements with different countries. With all of the statistical data that you have, are you in a position to assess the advantages and disadvantages, economically speaking, of possible bilateral agreements? Is there currently a bilateral agreement with other countries which we should make a priority for the future? There are different agreement possibilities.

I was examining the statistics on direct investment abroad. Do you have statistics for Canada on direct Canadian investment which would affect the provinces, more specifically? Moreover, still on the topic of direct investments abroad, we see that the finance and insurance sectors dominate in all of the industries.

I would like to hear your comments in this regard. This is a perspective which is gaining ground increasingly, with regard to these services. The increase in direct foreign investment is on the upswing. What consequence could this have on employment?

[The Chair, Conservative, Leon Benoit]

Go ahead, Mr. Ridgeway.

[Art Ridgeway]

There are a variety. A couple of them, I think, may be more from my policy colleagues to comment on.

[The Chair, Conservative, Leon Benoit]

Please do divide them up the way you see fit.

[Art Ridgeway]

I'll start with the insurance. It certainly has been one of the stronger ones. We've had some strong Canadian investment overseas in recent years, so it's one of the stronger-moving series. I think we have some fairly strong companies in that area of foreign direct investment in both directions. In general, the financial sector happens to be one of the most active in foreign direct investment in and out of Canada, but particularly on the outward side. It's an important area that we've seen growing.

Before I turn it to some of my colleagues, we don't have any data on provincial aspects of FDI. I could explain that quickly. Foreign direct investment is really ultimately a balance sheet measure; the basis is from the balance sheet. At the legal entity, balance sheets tend to be at the corporate level. The problem is that we can have an enterprise that has establishments in many different provinces, but they only have one balance sheet in Canada, so there is no real systematic way to decide whether this foreign direct is going to one province or another. It would be very arbitrary, and that causes all kinds of problems.

We're looking at possibilities of coming up with other measures, though: globalization measures that may be able to address some of those issues by identifying whether certain investments are being made by foreign-controlling companies, Canadian-controlling multinationals, or Canadian companies that just operate in Canada. This is a new program we're looking at. It may help answer the same questions as I think you're trying to look at with the question on provincial data.

As to the employment and the bilaterals, possibly I could let my colleagues from DFAIT attempt those ones.