Statistics Canada data on international trade in goods and services for February reflect the early impacts of the Covid-19 pandemic. The data also highlight emerging issues in producing reliable economic data.
Overall, the national statistical agency reported, services imports declined 0.5% to $12.7 billion, and exports dropped 0.3% to $11.0 billion.
As a result, the monthly deficit in services trade edged down to $1.7 billion.
In particular, exports of travel services declined by 5.8% in the month, as travel restrictions with China were imposed. Imports of travel services also declined.
StatsCan said that the Covid-19 outbreak didn’t appear to have a major impact on merchandise trade in February, although trade with China was affected.
Canada’s merchandise exports rose by 0.5% in February due to higher aircraft exports, StatsCan said. Imports were down 0.8%, partly due to a decrease in crude oil imports.
The data released by Stats-can also reveal emerging challenges with compiling accurate data in the current environment.
For example, for the first time, StatsCan is using data from the Canada Border Services Agency’s (CBSA) border inspection kiosks as a way to track trade in travel services.
Ordinarily, this data is estimated by using tourist and traveller counts.
“This approach works in a typical month, but would not work in the current situation, where travel restrictions that reduce tourist and traveller numbers are being implemented very rapidly,” StatsCan said.
The data from airport customs kiosks represent only a subset of total travellers, but, StatsCan said, “They provide relevant and timely insight.”
While travel restrictions started to affect services trade in February, StatsCan said, the effects are expected to be much greater in future data.
“It is expected that March will show a much more pronounced drop in both exports and imports of travel services, as many countries, including Canada, closed their borders in order to limit the global spread of the virus,” it said.
On the merchandise side, StatsCan expects to see greater impacts in the data for March.
To start, it noted that several North American automakers halted production in the month.
“This could have a significant effect on Canada’s merchandise trade,” StatsCan said, as this accounted for more than 17% of total merchandise trade in 2019.
Additionally, large drops in crude oil market prices will also impact merchandise trade, as oil represented almost 14% of total exports in 2019.
“The current situation is also affecting the production of statistics,” StatsCan said, as its ability to validate data may be hindered, which could lead to larger data revisions in the future.