Archive:Canada-EU - international trade in goods statistics

Data extracted in April 2018

Planned article update: April 2019

Highlights

In 2016, Canada was the seventh largest exporter and importer of goods in the world, with a share of 3.2 % of world exports and 3.1 % of world imports.

Among the EU's trading partners, Canada was the 12th largest partner for EU exports and the 11th largest partner for EU imports in 2017.

Among EU Member States, the United Kingdom was the largest importer (EUR 13.3 billion) from Canada in 2017, and Germany was the largest exporter (EUR 9.8 billion).

Imports, exports and trade balance between the EU and Canada, 2008-2017

This article provides a picture of the international trade in goods between the European Union (EU) and Canada. It analyses the type of goods exchanged between the two economies and the shares of each EU Member State in those exchanges.

This article is part of an online publication providing recent statistics on international trade in goods, covering information on the EU's main partners, main products traded, specific characteristics of trade as well as background information.

Full article

Overview

In 2016, Canada was the seventh largest exporter and importer of goods in the world with a share of 3.2 % of world exports and 3.1 % of world imports.
Among the EU's trading partners, Canada was the 12th largest partner for EU exports and the 11th largest partner for EU imports in 2017.
EU trade surplus with Canada peaked in 2015 at EUR 6.8 billion and stands at EUR 6.3 billion in 2017.
Manufactured goods dominate the exports of goods from the EU to Canada with 81 %, but contribute only to 41 % of imports from Canada to the EU.
In 2017, among the EU Member States, the United Kingdom is the largest importer (EUR 13.3 billion) from Canada and has the largest trade deficit with Canada (EUR 7.8 billion).
In 2017, Germany is the largest exporter (EUR 9.8 billion) to Canada and has the largest trade surplus with Canada (EUR 6.4 billion).

EU and Canada in world trade in goods

In 2016, the four largest exporters account for almost half of the world exports (Figure 1a). The largest is China (17 %) followed by the EU (16 %), the United States (12 %) and Japan (5 %). The same four also account for almost half of the world imports but in a different order. Here the United States (18 %) leads, followed by the EU (15 %), China (12 %) and Japan (5 %).

Figure 1a: The position of Canada among the world's largest traders, 2016
Source: Eurostat (ext_lt_introle)

A more detailed set of countries can be seen in Figure 1b, showing Canada's place between South Korea and Mexico for both exports and imports. With exports of EUR 351 billion and imports of EUR 364 billion, Canada is both the seventh largest exporter and importer, accounting for 3.2 % of world exports and 3.1 % of world imports.

Figure 1b: Top 25 exporters and importers in the world, 2016 (EUR billion)
Source: Eurostat (ext_lt_introle)

The evolution of trade in the EU and Canada over the period 2007-2016 is the focus of Figure 2. In 2007, Canada had cover ratio (exports divided by imports ) of 110 % while that of the EU was 85 %. Between 2007 and 2016 EU exports grew by 41 percentage points (pp) while Canadian exports grew by only 15 pp. In imports the reverse was true, with Canada's growth (31 pp) being more than that of the EU (18 pp). Consequently, the European trade deficit turned into a surplus in 2013 and has remained so since then. Canada's cover ratio dropped below 100 in 2009 and has remained below 100 since then, except in 2014.

Figure 2: Evolution of trade of the EU-28 and Canada (2007 = 100) and cover ratio 2007 to 2016
Source: Eurostat (ext_lt_introle)

EU surplus with Canada peaked in 2015

Canada's trade compared to the top four trading partners of the EU, which were the United States, China, Switzerland and Russia, is shown in Figure 3a. These four made up 43 % of all exports from the EU and 48 % of all imports to the EU. There is more detail in Figure 3b, which shows that in 2017, Europe's exports to Canada amounted to 37.7 billion (2.0 %) which meant it was the 12th largest export destination, just behind Mexico (EUR 37.9 billion, 2.0 %) and ahead of Hong Kong (EUR 36.8 billion 2.0 %). In imports, Canada was the 11th largest EU partner (EUR 31.4 billion, 1.7 %) between Vietnam (EUR 36.9 billion, 2.0 %) and Brazil (EUR 31.1 billion, 1.7 %).

Figure 3a: The position of Canada among the EU's main partners, 2017
Source: Eurostat (ext_lt_maineu)

Figure 3b: Top 20 import and export partners of the EU, 2017
Source: Eurostat (ext_lt_maineu)

The EU had a trade surplus with Canada from 2008 to 2010 and from 2012 to 2017 (see Figure 4). In this time span, trade between the two economies hit a low in 2009, but quickly recovered. Between 2009 and 2011 imports from Canada grew more strongly than exports to Canada resulting in a trade deficit in 2011. But while exports to Canada continued to grow after 2011, imports from Canada stagnated and the EU regained its trade surplus which peaked at EUR 6.8 billion in 2015 before dropping slightly to EUR 6.3 billion in 2017.

Figure 4: Imports, exports and trade balance between the EU and Canada, 2008-2017 (EUR billion)
Source: Eurostat (ext_lt_maineu)

EU exports to Canada largely dominated by manufactured goods

When breaking down imports and exports by SITC groups (Figure 5), the main categories driving exports to Canada are 'Machinery and vehicles', 'Chemicals' and 'Other manufactured goods'. Together these manufactured products accounted for around 81 % of EU exports. In imports from Canada 'Other goods' are the most traded category with 29 %, followed by 'Machinery and vehicles' with 21 %.

Figure 5: EU-28 exports to and imports from Canada by product group, 2008 and 2017 (EUR billion)
Source: Eurostat DS-018995

The evolution of EU imports and exports by SITC group since 2008 is shown in Figure 6. The EU has trade deficits in 'Other goods' and 'Raw materials'. In 'Chemicals', 'Food and drink','Machinery and vehicles' and 'Other manufactured goods' the EU has a trade surplus. In 'Energy' the trade balance switched from a surplus to a deficit several times between 2007 and 2017.

Figure 6: EU-28 imports, exports and trade balance with Canada by product group, 2008-2017 (EUR billion)
Source: Eurostat DS-018995

Most traded good: non-monetary gold

More details about the goods exchanged between the EU and Canada are presented in Figure 7, showing the top 20 traded goods at a more detailed level (by SITC level 3). Those top 20 goods covered around 60 % of total traded goods in 2017. Eight products among the top 20 belong to the 'Machinery and vehicles' group, three to 'Energy ' and two each to 'Chemicals' and 'Raw materials'. Non-monetary gold was the most traded product followed by motor cars and motor vehicles.

Another interesting way to look at data is to investigate the cover ratio (exports divided by imports) of traded goods, in order to better identify the direction taken by flows and specialisation between the two areas. These ratios can be found in the right margin of Figure 7. Non-monetary gold, iron ore and concentrates, pearls, coal and oil seeds all have values below five, indicating almost all imports from and hardly any exports to Canada. High ratios are found for alcoholic beverages, motor cars and motor vehicles and medicinal and pharmaceutical products implying the opposite. Several products have fairly moderate values implying trade flows in both directions. Non-electric engines and motors, with a ratio of 103 is an example where imports and exports are almost perfectly balanced.

Figure 7: Most traded goods with Canada, top 20 of SITC level 3 products, 2017 (EUR billion)
Source: Eurostat DS-018995

Germany and the United Kingdom are trading most with Canada

Figure 8a shows the imports of EU Member States from Canada and the share of the partner Canada in national extra-EU imports in 2017. Figure 8b provides similar information but concerning exports of EU Member States to Canada.

The United Kingdom is the largest importer from Canada (EUR 13.3 billion) and the second largest exporter (EUR 5.5 billion) to Canada in 2017. It also has the largest trade deficit with Canada (EUR 7.8 billion). With 4.9 %, the United Kingdom has the third highest share for Canada in total extra-EU imports. Only Malta (12.0 %) and Latvia (10.5 %) have higher shares while all other Member States' shares are below 3 %.

Figure 8a: Imports from Canada by Member State, 2017
Source: Eurostat DS-018995

Germany is the largest exporter to Canada (EUR 9.8 billion) and the second largest importer (EUR 3.5 billion) from Canada. It has the largest trade surplus with Canada (EUR 6.4 billion). Only Luxembourg (4.1 %) has a share of more than 3 % for Canada in its extra-EU exports.

Figure 8b: Exports to Canada by Member State, 2017
Source: Eurostat DS-018995

In 2017, 8 Member States had a trade deficit with Canada (Figure 8c), ranging from just EUR 2 million for Luxembourg to EUR 7.8 billion for the United Kingdom. The remaining 20 Member States had a trade deficit, starting at EUR 25 million for Lithuania to EUR 6.4 billion for Germany. Italy (EUR 2.4 billion) and the Netherlands (EUR 1.2 billion) were the only other Member States whose trade surplus was higher than one billion euro.

Figure 8c: Trade balance with Canada by Member State, 2017 (EUR million)
Source: Eurostat DS-018995

Source data for tables and graphs

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Data sources

EU data is taken from Eurostat's COMEXT database. COMEXT is the reference database for international trade in goods. It provides access not only to both recent and historical data from the EU Member States but also to statistics of a significant number of third countries. International trade aggregated and detailed statistics disseminated via the Eurostat website are compiled from COMEXT data according to a monthly process.

Data are collected by the competent national authorities of the Member States and compiled according to a harmonised methodology established by EU regulations before transmission to Eurostat. For extra-EU trade, the statistical information is mainly provided by the traders on the basis of customs declarations.

EU data are compiled according to Community guidelines and may, therefore, differ from national data published by the Member States. Statistics on extra-EU trade are calculated as the sum of trade of each of the 28 EU Member States with countries outside the EU. In other words, the EU is considered as a single trading entity and trade flows are measured into and out of the area, but not within it.

Data for the other major traders are taken from the Comtrade database of the United Nations. Data availability differs among countries, therefore Figure 1 shows the latest common available year for all the main traders. For the calculation of shares world trade is defined as the sum of EU trade with non-EU countries (source: Eurostat) plus the international trade of non-EU countries (source: IMF Dots database).

Methodology

According to EU concepts and definitions, extra-EU trade statistics (trade between EU Member States and non-EU countries) do not record exchanges involving goods in transit, placed in a customs warehouse or given temporary admission (for trade fairs, temporary exhibitions, tests, etc.). This is known as 'special trade'. The partner is the country of final destination of the goods for exports and the country of origin for imports.

Product classification

Information on commodities exported and imported is presented according to the Standard international trade classification (SITC). A full description is available from Eurostat's classification server RAMON.

Unit of measure

Trade values are expressed in millions or billions (10⁹) of euros. They correspond to the statistical value, i.e. to the amount which would be invoiced in case of sale or purchase at the national border of the reporting country. It is called a FOB value (free on board) for exports and a CIF value (cost, insurance, freight) for imports.

Context

Trade is an important indicator of Europe's prosperity and place in the world. The bloc is deeply integrated into global markets both for the products it sources and the exports it sells. The EU trade policy is an important element of the external dimension of the 'Europe 2020 strategy for smart, sustainable and inclusive growth' and is one of the main pillars of the EU's relations with the rest of the world.

Because the 28 EU Member States share a single market and a single external border, they also have a single trade policy. EU Member States speak and negotiate collectively, both in the World Trade Organization, where the rules of international trade are agreed and enforced, and with individual trading partners. This common policy enables them to speak with one voice in trade negotiations, maximising their impact in such negotiations. This is even more important in a globalised world in which economies tend to cluster together in regional groups.

The openness of the EU's trade regime has meant that the EU is the biggest player on the global trading scene and remains a good region to do business with. Thanks to the ease of modern transport and communications, it is now easier to produce, buy and sell goods around the world which gives European companies of every size the potential to trade outside Europe.