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• W302533334 abstract "I. INTRODUCTION The pervasive notion that Canada is extraordinarily dependent on trade influences debates about foreign policy, domestic policy, and even future of Confederation. Many commentators argue that securing access to foreign markets should trump other interests and values in formulating Canadian policy. Influential have proposed a grand bargain with US in which Canada would conform to American security, energy, military, and trade policies in order to ensure an open border. (1) The Security and Prosperity Partnership of North America--agreed to by Canada, US, and Mexico in March 2005--constitutes at least a small step toward such a bargain. (2) On domestic front, case for lower taxes, less regulation, and smaller government is largely based on perceived need to compete in global markets. (3) Proposals to redistribute wealth, or to advance other social values, are often rejected not because they are seen to be undesirable, but because they are deemed to be infeasible in new globalized Some observers even contend that trade flows are altering very foundations of Confederation. Policy arguments about Canada's dependence on trade are almost always supported with reference to exports, rather than imports. For example, former free-trade negotiator Gordon Ritchie describes as the central pillar of our national interest. (4) By contrast, leading economist Paul Krugman argues that imports, not exports, are purpose of trade. That is, what a country gains from trade is ability to import things it wants. (5) In fact, many of things that Canada imports are used as inputs to produce exports. (6) By taking both and imports into account, this paper paints a different picture of Canada's international trade and its implications for public policy. As Canadian nationalist Mel Hurtig observes, Canadians have been constantly bombarded with statements to effect that our now [2002] account for between 40 and 50 percent of our (7) However, gross declined from 45 percent of GDP in 2000 to 38 percent of GDP in 2003, and remained at this level in 2004 and 2005. Gross imports were equal to 38 percent of GDP in 2000 and declined to 34 percent in 2003, remaining at this level in 2004 and 2005. (8) Trade numbers should be interpreted carefully: simply using more recent data and measuring trade in terms of imports rather than reduces its magnitude from nearly half to one-third of Conventional trade statistics compare gross exports, including a substantial amount of imported content, to value-added GDP, consisting only of Canadian content. Export statistics measure gross value of goods and services moved across Canada's borders, but GDP measures value of goods and services created in Canada. Grant Cameron and Philip Cross of Statistics Canada explain that use of imported inputs to produce Canadian has effect of inflating trade flows relative to their actual contribution to economy. (9) While Canada's gross-export tally amounted to 41 percent of GDP in 2002, import content in these was worth 14 percent of GDP. Therefore, contributed only 26 percent of Canada's GDP that year. (10) Despite Statistics Canada's excellent technical work on import content of since 1999, (11) almost all policy literature continues to present as accounting for around 40 percent of GDP. (12) For example, Government of Canada's recent International Policy Statement indicates that exports account for almost 40% of our economy. (13) Misleading gross figures are not used solely for sake of simplicity. The Government of Canada published NAFTA @ Ten: A Preliminary Report in 2003. Since section on Canada-US trade and investment includes some forty-three graphs, twenty-five statistical tables, and fourteen map and pie-chart displays, its omission of import content of cannot be attributed to somewhat greater complexity of value-added figures than gross figures. …" @default.
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• W302533334 date "2005-01-01" @default.
• W302533334 modified "2023-09-27" @default.
• W302533334 title "Lies, Damned Lies, and Trade Statistics: North American Integration and the Exaggeration of Canadian Exports" @default.
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