MNI DATA REACT: Canada Sees 1st Services Surplus Since 2007

--Services Trade Balance CAD203 Mln in April Vs -CAD1.1 Bln March

By Greg Quinn

     OTTAWA (MNI) - Canada had its first surplus in global services trade in at

least two decades in April, as health lockdowns erased a longstanding shortfall

in travel spending. 

     The balance swung to a CAD302 million surplus from March's CAD1.1 billion

deficit, according to Statistics Canada data published Thursday. It's the first

such surplus in data going back to 2007, and the deficit was as high as CAD1.9

billion in December. 

     Travel services moved to a CAD763 million surplus in April from deficits of

CAD166 million in March and CAD1.1 billion in February. The deficit in

transportation narrowed to CAD493 million from CAD913 million in March.

     Canada historically runs deficits on travel services with residents seeking

warm weather in the U.S. and overseas. Most foreign travel has been shut down

amid Covid-19.

     The figures offset some of the downside in the headline report Thursday on

merchandise goods trade, showing the deficit widened to CAD3.3 billion from

CAD1.5 billion. Canada's recovery from the pandemic was also threatened by the

prospect of a slowdown in record population growth amid travel restrictions. 

     --STUDENTS REMAIN

     A driver of Canada's turnaround in services expenditures is foreign

students. Canada kept relatively more of its international students in the

country through the pandemic, Statistics Canada said in a report Thursday. 

     Still, the move to a surplus was driven by a reduction in two-way trade.

Imports of services fell 31% to CAD7.8 billion, and exports by 21% to CAD8.1

billion. The figures are also subject to larger revisions than usual due to

difficulty gathering data, Statistics Canada said. 

--MNI Ottawa Bureau; +1 613-314-9647; email: greg.quinn@marketnews.com

--MNI Washington Bureau; +1 202-371-2121; email: jean.yung@marketnews.com

[TOPICS: MACDS$,M$C$$$,MI$$$$]