David Raymond Amos @DavidRayAmos
Replying to @DavidRayAmos @Kathryn98967631 and 49 others
BruceJack Speculator
"chemistry does not really depend on the language of the doer and doubling the number of administrators or supervisors definitely reduces the number of technicians that can be paid"
https://davidraymondamos3.blogspot.com/2020/01/moncton-hospital-overcrowded-asks.html
https://www.cbc.ca/news/canada/new-brunswick/hospital-laboratories-consolidation-flemming-higgs-1.5415021
Facing staffing crunch, province could slash number of hospital labs by more than half
Government issued call for proposals that would consolidate 20 labs into as few as 7
· CBC News · Posted: Jan 06, 2020 7:00 AM AT
The provincial government has issued a request for proposal to develop a plan to consolidate hospital lab work. (CBC)
The New Brunswick government is looking at ways to centralize hospital laboratories, including a proposal that would see the number of facilities slashed by more than half.
A request for proposals issued Nov. 21 is aimed at finding private-sector management consultants who can develop a plan to consolidate 20 hospital labs into as few as seven.
It says the rationale for closures and centralization is not saving money but responding to a "human resource crisis" that will see 40 per cent of medical laboratory technologists eligible for retirement in the next five years.
"Current supply is not able to keep up with attrition rate due to retirement," the document says. "Concerns are also being raised as to the significant knowledge gap resulting from these retirements."
The document refers back to a 2013 report that "identified opportunities for improvement through reorganization."
That report, obtained by CBC News through a right-to-information request, recommended the closure of labs in smaller hospitals and health centres in Miramichi, Saint John, Waterville, St. Stephen, Sussex, Oromocto, Sackville, Minto, Plaster Rock, Grand Falls, Saint-Quentin, Dalhousie, Caraquet, Lameque and Tracadie.
Those services would be "integrated" into labs in seven larger hospitals in Moncton, Saint John, Fredericton, Edmundston, Campbellton and Bathurst, the report said.
Minister hinted at need for consolidation
Health Minister Ted Flemming was not available to comment on the request for proposals, which has a Jan. 7 deadline.
But in a November scrum about the temporary closure of some patient services at the Campbellton hospital, Flemming cited laboratories as a service that could be centralized without affecting patient care, possibly with just two provincial labs.
Health Minister Ted Flemming says centralizing lab work would not impact care. (CBC)
"If you go to a facility and you have your blood taken, what you want to know is your cholesterol and your blood sugar and the usual things that they do," he said.
"What does it matter that that isn't done in one or two centralized areas, one in Vitalité and one in Horizon, for example?
"This doesn't impact care. This doesn't compromise anything. We have an extremely efficient courier system so why do we need 20 labs with 20 people figuring out what people's cholesterol is?"
We're running out of people. There is a storm gathering here.
- Health Minister Ted FlemmingFlemming made the comments the same day his department issued the request for proposals, though he didn't mention the RFP.
He referred to the same difficulty of recruiting enough staff cited in the document. "We're running out of people," he said. "There is a storm gathering here."
An aging population requires more health care at the same time there are fewer working-age New Brunswickers to fill jobs, he said.
"Realistically, this is what we have. These are the people, these are the demands and we have to rationalize what we're doing." Lab consolidation "is an example of types of rationalization that need to be done and that we're going to do."
Short-term fix
The union representing more than 400 lab technologists said it is relieved the province hasn't opted for privatization and said it won't necessarily oppose the consolidation.
"We were kind of in favour of that versus the privatization as long as it wasn't disruptive to the workers," said president Susie Proulx-Daigle, adding some lab samples already move between hospitals for specialized testing.
She said her goal will be to ensure no lab employees are laid off or forced to move to another location while the plan is put in place.
Union president Susie Proulx-Daigle said she wants to ensure no lab employees are laid off during a potential consolidation. (CBC)
"If they're going to do a change, as long as it benefits everybody, and it's good for the public, the consumer, the people who need the service, then we're going to work with them to try to make sure that it works," she said.
She warned though that consolidation will only be a temporary solution and that the same recruitment issue will rear its head again after consolidation. "This will only work for a few years," she said.
According to the 2013 report, the government began looking at lab services as far back as 1997. But a consultant's recommendations made at the time remained "relatively dormant" until the health department raised the issue again in 2012.
The 2013 report said new technology and a focus on preventative care will make detecting disease more important, causing lab testing to "sky rocket" in the coming years.
Labs will have to be "lean, efficient and productive with the ultimate outcome 'increase value for their customer,'" the report said.
It looks at a number of options, including creating a new "shared laboratory services corporation" or privatizing the service completely. A section on "other potential opportunities" is blacked out.
But the report recommended the service remain under the health authorities, with seven labs to service the province.
There would be three labs in southern New Brunswick hospitals, two of them providing specialized testing, one for all of the Horizon health authority and the other for Vitalité.
It said two smaller "reference labs" and two "rapid response" labs would remain in the north.
A 2013 report recommended reducing the number of hospital labs to seven to service the entire province. ((CBC))
The recent request for proposals says a second report in 2018 made recommendations as well, but those are not available publicly.
The RFP says developing an implementation plan would take a year and putting it into effect would take another two years.
It says consolidation will require greater "collaboration and interconnectivity" within the two regional health authorities and between them.
Their labs now use eight different health and lab information systems with "minimal communication and inconsistent definitions and nomenclature." Part of the consulting firm's job will be to address and develop a new transportation system for moving samples.
Premier says major health reforms coming
The two regional health authorities were told last Aug. 12 that the RFP was coming.
"Horizon Health Network has been working closely with the Department of Health and Vitalité Health Network to improve our laboratory services and are aware of the RFP that has been issued," Horizon vice-president Gary Foley said in an emailed statement.
"We look forward to working collaboratively with our health care partners to adapt our services to meet the laboratory service needs of our province."
No one from Vitalité was available to comment.
Premier Blaine Higgs said last fall his government would unveil details of major health reforms in the first three months of 2020.
"I hope to be able to communicate in a way that people understand the rationale behind everything we do," he said in a year-end interview. "I would never suggest that means everyone will like it. It's just that they'll understand why."
With files from Shane Magee and Karissa Donkin
67 Comments
David Raymond Amos
"No one from Vitalité was available to comment."
Surprise Surprise Surprise
Ben Haroldson
Reply to @David Raymond Amos: They were working. Too busy.
Terry Tibbs
Reply to @Ben Haroldson:
In so-called "meetings" not to be disturbed more like.
Denis LeBlanc
It like this is the beginning of the end for many local hospitals. How will the be able to run an emergency ward without a lab? I can see this for routine tests like cholesterol or blood sugar as long as the blood can still be taken locally. Speaking of this...why should you need a lab tech to sample blood? Couldn't a nurse or nurse practitioner do this and free the lab techs to do the analysis? Finally, we are beginning to see the short sightedness of centralizing a lot of services in big regional center when they can no longer handle the load. Furthermore, what happens when one of these super labs is closed down by some sort of emergency, contamination, epidemic or catastrophy? What then? Does the system collapse for a few weeks? How about some unknown illness outbreak in a town or city? You risk spreading the illness to one of the main cities or hospitals in the province. Do you really think it is worth it because of poor planning, pay, benefits and staffing levels already imposed on hospitals?
Ben Haroldson
Reply to @Denis LeBlanc: Wholesale privatization. Anti constitutional, the lib way.
Ray Bungay
Reply to @Denis LeBlanc: Union protectionism IMO!
David Raymond Amos
Reply to @Denis
LeBlanc: "It like this is the beginning of the end for many local
hospitals. How will the be able to run an emergency ward without a lab?"
BINGO
BINGO
Chuck Stewart
Less young people want to work in the health care of the public sector. The system is broken and it is the fault of the society. Hospitals are run by government who are always looking to satisfy the voters, therefore there is no doing what is right , instead it is down to doing what is popular. Higgs is the first premier to try to do what is right and not worry about the votes. The equipment is all there, but with nobody to run it, what can you do. If I was a lab tech, I would not encourage any young person to go into public health care in this province right now. It is very frustrating to see how tax money is wasted.
Terry Tibbs
Reply to @Chuck Stewart:
"I would not encourage any young person to go into public health care in this province "
Because of the crap working conditions and wages.
But get educated here, and move away, and get instant employment, great benefits, and excellent wages.
"I would not encourage any young person to go into public health care in this province "
Because of the crap working conditions and wages.
But get educated here, and move away, and get instant employment, great benefits, and excellent wages.
Joe Mufferaw
Reply to @Terry
Tibbs: I don't think you are correct here Terry. Lab Techs in BC make 2
bucks an hour more than NB. Wages are not the problem in Heatlh care.
The problem is that most open position are either casual or part time.
That is why people move away. Hire full time and they will stay.
David Raymond Amos
Reply to @Joe Mufferaw: Good point
Gary MacKay
It will be interesting to see how this progresses. I recall Previous Premier Frank M. Trying to join the two labs in Moncton and make one to save a significant amount. That was dropped rather quickly. Some how we have to find ways to reduce. Hopefully they can work together to make things more efficient. Truly we really only need one health authority. IMO
BruceJack Speculator
Reply to @Gary
MacKay: agree. I know this is naive of me to say but chemistry does not
really depend on the language of the doer and doubling the number of
administrators or supervisors definitely reduces the number of
technicians that can be paid from the same $ of budget
David Raymond Amos
Reply to @BruceJack Speculator: Speaking simple truths cannot be naive
Ben Haroldson
Reply to @Gary MacKay: This place is living with frankies legacy. Lovely ain't it?
John Holmes
Now that's a page straight out of the UCP playbook. This most certainly won't end well, not when the health care in this province is already slower than molasses.
Johnny Horton
Reply to @John Holmes:
I do not find the health care system slow. Of course I don’t clog up the system with sniffles. When I go it’s something thst needs fixed. Usually within a week of a trip to emerg, I’m booked and in any needed surgery or work.
Ben Haroldson
Reply to @Johnny Horton: You get surgery often?
Johnny Horton
Reply to @Ben Haroldson:
When needed yes. Surgery doesn’t always fix an issue. Thst is worded wrong... surgery doesn’t fix the underlying problems thst led to surgery, still worded wrong but better.
If one jumps out of planes without a chute, surgery will fix the broken bones, but one can just go do it again :)
When needed yes. Surgery doesn’t always fix an issue. Thst is worded wrong... surgery doesn’t fix the underlying problems thst led to surgery, still worded wrong but better.
If one jumps out of planes without a chute, surgery will fix the broken bones, but one can just go do it again :)
John Holmes
Reply to @Johnny
Horton: I waited over a year for a heart test that my Doctor scheduled
for me. And when I showed up, they told me the person who did the tests
was off sick, and it was the wrong test anyways. THE person who did that
test. One person. Think about that. If anything illustrates how bad
staffing levels are in this province, that does it.
I'm stupidly stoic about my health, I generally don't go near a medical person unless I'm on deaths door, or feel like I am.
I'm stupidly stoic about my health, I generally don't go near a medical person unless I'm on deaths door, or feel like I am.
David Raymond Amos
Reply to @John Holmes: "I generally don't go near a medical person unless I'm on deaths door"
Me Too and when I do I have to pay for the Health Care because Higgy and and his cohorts put a so called "Stay" on my Medicare Card
Me Too and when I do I have to pay for the Health Care because Higgy and and his cohorts put a so called "Stay" on my Medicare Card
Johnny Horton
Reply to @David Raymond Amos:
That’s what ya get for leavin the country.
Johnny Horton
Reply to @John Holmes:
Well one could say if you waited a year for a test, then the test really wasn’t an emergency. You certainly didn’t die in thst waiting yesr.
Well one could say if you waited a year for a test, then the test really wasn’t an emergency. You certainly didn’t die in thst waiting yesr.
Joe Mufferaw
Reply to @Johnny
Horton: You must live in Moncton, Fredericton or Saint John. My
daughter has been waiting a year to get her tonsils out become they
affect her breathing. Once it does happen we have to go to Moncton and
stay in town for 7 days. Good thing you don't take up space in
emergency and only go for important stuff.
David Raymond Amos
Reply to @Joe
Mufferaw: Methinks the Irving shill has to go to the emergency room to
get his foot removed from his mouth and by his own words it appears to
happen way too often N'esy Pas?
Danny Devo
With conservatives making decisions, conditions are sure to deteriorate. They always do. When things become completely dysfunctional, they resort to their corporate buddy system, hiring friends and family to provide private health services, just like that clown in Alberta is doing.
David Peters
Reply to @Danny Devo:
That's problem is endemic to monopolies, whether they're public or private.
That's problem is endemic to monopolies, whether they're public or private.
BruceJack Speculator
Reply to @Danny Devo:
surely you jest . . . did you mean to say "politicians" instead of
"conservatives" or did you never read about, recent example, the
"shipyard" in Bas Caraqet, or the numerous attempts to build a
campground in Shediac rather than clean up the water or ... or ... or ?
David Raymond Amos
Reply to @BruceJack Speculator: Interesting expression
Lou Bell
The " Centralized Laundry " worked so well !! NOT !!!!!!!!!!!!!!!!!!!!!
David Raymond Amos
Reply to @Lou Bell: Methinks you should remind us of your work within our Health Care System N'esy Pas?
Stephen Blunston
here a novel idea lets save millions or billions and get rid of the duplicate system and actually make something bilingual in this province and have 1 not 2 systems
David Raymond Amos
Reply to @stephen blunston: Dream on
Kevin Archibald
Is it possible that a N.B. Premier is really fiscally responsible ? First time in my life, and I'm 59. Go Higgs.
Fred Brewer
Reply to @Kevin
Archibald: I guess you are forgetting about the Liberal Premier Frank
McKenna. He was Premier of NB from 1987 to 1997 and was the first
premier in 13 years to actually start paying off our debt and brought
our fiscal house into order.
Fred Brewer
Reply to @BruceJack Speculator: Yes. He reduced the size of the civil service, reduced services and unilaterally imposed a wage freeze on unions and yet the voters kept him in office for 3 terms. This is proof that the average voter understands the need for fiscal restraint even if it means we must endure some hardships. McKenna created over 6,000 call centre jobs during his tenure as Premier.
David Raymond Amos
Reply to @Fred Brewer: Say Hey to to your buddy Franky for me will ya?
https://twitter.com/
David Raymond Amos @DavidRayAmos
Replying to @DavidRayAmos @Kathryn98967631 and 49 others
Content disabled
Enjoy
https://www.sec.gov/Archives/edgar/data/230098/000113031902001603/m08476e18vk.htm
Methinks folks should read Minister of Finance Paul Martin's report for the Corporation known as Canada to the Yankee SEC in December of 2002 N'esy Pas?
https://davidraymondamos3.blogspot.com/2020/01/moncton-hospital-overcrowded-asks.html
#nbpoli #cdnpoli
https://www.cbc.ca/news/canada/new-brunswick/moncton-hospital-overcapacity-1.5415259
Moncton Hospital overcrowded, asks people to seek alternatives
Horizon recommends calling Tele-Care, visiting a pharmacist or family doctor, or going to clinic
CBC News · Posted: Jan 04, 2020 5:42 PM AT
Horizon Health Network said the public should rethink their options for care before going to Moncton Hospital's emergency room. (CBC)
Horizon Health Network is urging people
in Moncton and surrounding areas to rethink their options for care
because the Moncton Hospital is overcrowded.
On Saturday, Horizon tweeted that patients looking for care should visit sowhywait.ca to determine if their symptoms are severe before going to the emergency room.
"If you're in the ER and you need to be admitted, right now they're going to have problems finding beds," said Lynn Meahan, a spokesperson for Horizon Health Network.
Options for care include calling Tele-Care by dialling 811, visiting a pharmacist or family doctor and going to an after-hours clinic.
Meahan said people could be looking at a 12-hour wait if they go to the hospital for something like a sore throat.
There are 24 acute care and trauma beds in the emergency unit — all of which are occupied, said Dr. Ken Gillespie, chief of staff at the Moncton Hospital.
Gillespie said it's hard to pinpoint why the Moncton Hospital has experienced an increase in patients.
"People have been on holidays, maybe they've been putting things off a little bit," Gillespie said.
"A lot of the family doctors' offices are closed over the holidays so they don't have access to that and now they're having a deterioration in their symptoms and they want to get things looked at."
The Moncton Hospital also faced overcrowding last year when patients were taking up beds while awaiting another level of care.
On Saturday, Horizon tweeted that patients looking for care should visit sowhywait.ca to determine if their symptoms are severe before going to the emergency room.
"If you're in the ER and you need to be admitted, right now they're going to have problems finding beds," said Lynn Meahan, a spokesperson for Horizon Health Network.
Options for care include calling Tele-Care by dialling 811, visiting a pharmacist or family doctor and going to an after-hours clinic.
Meahan said people could be looking at a 12-hour wait if they go to the hospital for something like a sore throat.
Beds all in use
There are 24 acute care and trauma beds in the emergency unit — all of which are occupied, said Dr. Ken Gillespie, chief of staff at the Moncton Hospital.
Gillespie said it's hard to pinpoint why the Moncton Hospital has experienced an increase in patients.
"People have been on holidays, maybe they've been putting things off a little bit," Gillespie said.
"A lot of the family doctors' offices are closed over the holidays so they don't have access to that and now they're having a deterioration in their symptoms and they want to get things looked at."
The Moncton Hospital also faced overcrowding last year when patients were taking up beds while awaiting another level of care.
84 Comments
Commenting is now closed for this story.
David Peters
There could be an opt out option. Opt out of medicare and have all medical expenses as a tax write-off.
Free market solutions, including competition, produce goods and services better, faster and cheaper. Why wouldn't this work in the healthcare sector too?
David Raymond Amos
Reply to @David
Peters: Methinks many would agree that Horizon Health Network is just
another Crown Corp with way too many overpaid bureaucrats who are
playing games with politicians over our money and our health N'esy Pas?
John Pokiok
Reason for this is little known issue how doctors in NB hospitals are payed for. They are paid the same weather they see 1 or 10 Patients. They need to be paid per patient and than you will see the difference. Right now they sit around nurses are flicking their phones because doctors dictate how many people they admit per hour, and people are waiting in waiting area for hours you don't believe me ask someone that works there.
David Raymond Amos
Reply to @John Pokiok: They are paid per patient
Jef Cronkhite
Reply to @John Pokiok: yeah, I don't know where you get that information, but it is incorrect.......
Bob Smith
Reply to @John
Pokiok: You might want to check the salaries posted by NB physicians
online first. More than a few see a lot of patients whether they are
family doctors or specialists.
David Raymond Amos
Methinks it is fairly obvious that this is not news to Higgy and his cohorts N'esy Pas?
https://www.cbc.ca/news/canada/new-brunswick/georges-dumont-hospital-capacity-1.5060707
Greg Miller
About four years ago my son had a sore throat and because of his medical history and the fact the he didn't have a doctor in Vancouver he visited a hospital emergency room. A doctor saw him about 15 minutes later -- AND APOLOGIZED FOR THE WAIT! P.S. My son moved to Vancouver recently and had no difficulty getting a family doctor.
Troy Murray
Reply to @Greg Miller: Great news
David Raymond Amos
Reply to @Greg Miller:
I am very grateful to have a family doctor in NB and pay for his
services out of pocket even though I am entitled to Medicare just like
your son is in BC. Less than a month ago I reported to emergency room
of the Dr. Georges-L.-Dumont hospital in Moncton in order to have some
scheduled tests of my old ticker ordered by another doctor. However the
lady registering me gave me a hard time keeping my appointments because I
did not have a Medicare Card and demanded that I apply for one through
SNB ASAP.I told here I had been there and done that long ago. She had
no answer for me when I asked what concern was it of hers as long as I
paid the Vitalité Health Network bills. For the record last fall in
order to run again in Fundy Royal I had to register with Elections
Canada with the address printed on my meds because of SNB's deliberately
incompetent behaviour. Go figure why I am angry with the malicious
actions of my political foes against me.
Bob Smith
Doesn't help when the hospital has two floors of beds dedicated to seniors awaiting placement in long term care facilities. It's a situation that has existed since before the eighties and got worse over the decades since. The politicians and hospital executives will use the familiar platitudes of "looking into the situation/evaluating the matter.." and so on but no one will try and make a dent in it. Why? No money or backbone to change the status quo...
David Raymond Amos
Reply to @Bob Smith:
At least all the politicians and bureaucrats who have no backbones have a
Medicare Card. Ask yourself why Higgy and his cohorts won't give me
mine so that I have to pay when I visit the emergency room to have my
old ticker tested.
Bart JW
Reply to @Bob Smith: So what is the solution in your opinion? More money has not worked.
Pierre Cyr
Reply to @Bart JW:
There hasnt been more money there has been cuts per capita on average
per patient over age 65 who are the biggest consumers of health as the
population has aged. The system is constantly being asked to do more and
treat more patients with less.
Bob Smith
Reply to @Bart JW:
More money where? Building more senior homes has been way behind demand
for just as long. Add that to the problem they don't have nurses hired
to staff the hospitals and there's two flaws. A solution? Maybe start by
financially helping families to care for their elderly loved ones at
home rather than in hospitals where possible. Status quo is not working
and kicking this can down the road is only making it worse.
Greg Miller
Reply to @Bart JW: Solution? Move to another province and chose which one you go to carefully.
David Raymond Amos
Reply to @Greg Miller: How about mentioning my name to Higgy before I sue the Crown again?
Jim Cyr
Reply to @This
is absolutely neanderthal. And it keeps happening over and over,
throughout the province. (Or similar problems). Canadians always brag
about their socialized medicine.....then crap like this happens.
David Raymond Amos
Reply to @Jim Cyr: Who do you blame for this nonsense?
Allan J Whitney
Quite a few things have disappeared down the old memory hole.
Like that document "The IMF's Structural Adjustment Programme for Canada 1994- 1995", received by the Paul Martin government, which outlines the necessity of offloading government expenditures to the private sector (privatization). They actually recommend cutting the funding to certain programs in order to CREATE THE OUTCRY for privatization.
David Raymond Amos
Reply to @Allan J
Whitney: Methinks folks who seek the truth should read the report of
Paul Martin as Minister of finance to the the Yankee SEC in December of
2002 for the Corporation known as Canada N'esy Pas?
David Raymond Amos
Content disabled
Reply to @Allan J Whitney: Enjoy https://www.sec.gov/Archives/edgar/data/230098/000113031902001603/m08476e18vk.htm
FORM 18-K
For Foreign Governments and Political
Subdivisions Thereof
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
ANNUAL REPORT
of
CANADA
(Name of Registrant)
Date of end of last fiscal year:
March 31, 2002
SECURITIES REGISTERED*
(As of the close of the fiscal year)
| Time of Issue | Amounts as to which registration Is effective |
Name of exchange on which registered |
||
N/A
|
N/A | N/A | ||
Name and address of person authorized to
receive notices
and communications from the Securities and
Exchange Commission:
HIS EXCELLENCY MICHAEL KERGIN
Canadian Ambassador to the United States of
America
Canadian Embassy
501 Pennsylvania Avenue, N.W.
Washington, D.C. 20001
Copies to:
BILL MITCHELL
Director Financial Markets Division Department of Finance, Canada 20th Floor, East Tower L’Esplanade Laurier 140 O’Connor Street Ottawa, Ontario K1A 0G5 |
DAVID MURCHISON Consul Consulate General of Canada 1251 Avenue of the Americas New York, N.Y. 10020 |
ROBERT W. MULLEN, JR. Milbank, Tweed, Hadley & McCloy LLP 1 Chase Manhattan Plaza New York, N.Y. 10005 |
* The Registrant is
filing this annual report on a voluntary basis.
Table of Contents
The information set forth below is to be
furnished:
| 1. | In respect of each issue of securities of the registrant registered, a brief statement as to: |
| (a) | The general effect of any material modifications, not previously reported, of the rights of the holders of such securities. |
No such modifications.
| (b) | The title and the material provisions of any law, decree or administrative action, not previously reported, by reason of which the security is not being serviced in accordance with the terms hereof. |
No such provisions.
| (c) | The circumstances of any other failure, not previously reported, to pay principal, interest, or any sinking fund or amortization installment. |
No such failure.
| 2. | A statement as of the close of the last fiscal year of the registrant giving the total outstanding of: |
| (a) | Internal funded debt of the registrant. (Total to be stated in the currency of the registrant. If any internal funded debt is payable in a foreign currency, it should not be included under this paragraph (a) but under paragraph (b) of this item). |
Reference is made to pages 25-27 of
Exhibit D.
| (b) | External funded debt of the registrant. (Totals to be stated in the respective currencies in which payable). No statement need be furnished as to inter-governmental debt. |
Reference is made to pages 25-27 of
Exhibit D.
| 3. | A statement giving the title, date of issue, date of maturity, interest rate and amount outstanding, together with the currency or currencies in which payable, of each issue of funded debt of the registrant outstanding as of the close of the last fiscal year of the registrant. |
Reference is made to pages 34-47 of
Exhibit D.
| 4. (a) | As to each issue of securities of the registrant which is registered, there should be furnished a breakdown of the total amount outstanding, as shown in Item 3, into the following: |
| (1) | Total amount held by or for the account of the registrant. |
As at December 1, 2002, the registrant held
a de minimis amount.
| (2) | Total estimated amount held by nationals of the registrant (or if registrant is other than a national government, by the nationals of its national government); this estimate need be furnished only if it is practicable to do so. |
Not practicable to furnish.
| (3) | Total amount otherwise outstanding. |
Not applicable.
| (b) | If a substantial amount is set forth in answer to paragraph (a)(1) above, describe briefly the method employed by the registrant to reacquire such securities. |
Not applicable.
| 5. | A statement as of the close of the last fiscal year of the registrant giving the estimated total of: |
| (a) | Internal floating indebtedness of the registrant. (Total to be stated in the currency of the registrant). |
Reference is made to pages 25-27 of
Exhibit D.
| (b) | External floating indebtedness of the registrant. (Total to be stated in the respective currencies in which payable). |
Reference is made to pages 25-27 of
Exhibit D.
Table of Contents
| 6. | Statements of the receipts, classified by source, and of the expenditures, classified by purpose, of the registrant for each fiscal year of the registrant ended since the close of the latest fiscal year for which such information was previously reported. These statements should be so itemized as to be reasonably informative and should cover both ordinary and extraordinary receipts and expenditures; there should be indicated separately, if practicable, the amount of receipts pledged or otherwise specifically allocated to any issue registered, indicating the issue. |
Reference is made to pages 18-24 of
Exhibit D.
| 7. (a) | If any foreign exchange control, not previously reported, has been established by the registrant (or if the registrant is other than a national government, by its national government), briefly describe such foreign exchange control. |
No foreign exchange controls have been
established by the registrant.
| (b) | If any foreign exchange control previously reported has been discontinued or materially modified, briefly describe the effect of any such action, not previously reported. |
Not applicable.
| 8. | Brief statements as of a date reasonably close to the date of the filing of this report (indicating such date) in respect of the note issue and gold reserves of the central bank of issue of the registrant, and of any further gold stocks held by the registrant. |
Reference is made to page 17 of Exhibit D.
| 9. | Statements of imports and exports of merchandise for each year ended since the close of the latest year for which such information was previously reported. Such statements should be reasonably itemized so far as practicable as to commodities and as to countries. They should be set forth in terms of value and of weight or quantity; if statistics have been established only in terms of value, such will suffice. |
Reference is made to pages 12-14 of
Exhibit D.
| 10. | The balances of international payments of the registrant for each year ended since the close of the latest year for which such information was previously reported. The statements of such balances should conform, if possible, to the nomenclature and form used in the “Statistical Handbook of the League of Nations.” (These statements need be furnished only if the registrant has published balances of International payments.) |
Reference is made to pages 15-16 of
Exhibit D.
On March 12, 1996, Canada established a
program for the offering, from time to time, of its Canada Notes
due nine months or more from date of issue (“Canada
Notes”). During the period from December 1, 2001
through November 30, 2002, Canada did not file with the
United States Securities and Exchange Commission any pricing
supplements relating to the sale of Canada Notes. Consequently,
the portion of Canada Notes sold or to be sold during that
period in the United States or in circumstances where
registration of the Canada Notes is required through
November 30, 2002 was U.S.$0.
Cautionary statement for purposes of the
“safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995.
This annual report, including the exhibits
hereto, contains various forward-looking statements and
information that are based on Canada’s belief as well as
assumptions made by and information currently available to
Canada. When used in this document, the words
“anticipate”, “estimate”,
“project”, “expect”, “should” and
similar expressions are intended to identify forward-looking
statements. Such statements are subject to certain risks,
uncertainties and assumptions. Should one or more of these risks
or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those
anticipated, estimated or projected. Among the key factors that
have or will have a direct bearing on Canada are the world-wide
economy in general and the actual economic, social and political
conditions in or affecting Canada.
Table of Contents
This annual report comprises:
| (a) | Pages numbered 1 to 5 consecutively. | |
| (b) | The following exhibits: |
Exhibit A:
|
None | |
Exhibit B:
|
None | |
Exhibit C-1:
|
Copy of the 2001 Budget of Canada (incorporated by reference from Exhibit C-4 to Canada’s Amendment No. 3 to Form 18-K for the fiscal year ended March 31, 2000) | |
Exhibit C-2:
|
Copy of the Economic and Fiscal Update October 30, 2002, Department of Finance, Canada (incorporated by reference from Exhibit C-2 to Canada’s Amendment No. 1 to Form 18-K for the fiscal year ended March 31, 2001 on Form 18-K/A dated November 1, 2002) | |
Exhibit D:
|
Current Canada Description | |
Exhibit E:
|
Consent of Deputy Minister of Finance |
This annual report is filed subject to the
instructions for Form 18-K for Foreign Governments and
Political Subdivisions Thereof.
Table of Contents
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this annual
report to be signed on its behalf by the undersigned, thereunto
duly authorized, at Ottawa, Canada, on the 20th day of December,
2002.
| CANADA | ||||
| By: | /s/ Rob Stewart | |||
| Rob Stewart | ||||
| Senior Chief | ||||
| Financial Markets Division | ||||
| Financial Sector Policy Branch | ||||
| Department of Finance, Canada | ||||
Table of Contents
EXHIBIT INDEX
| Exhibit No. | ||
Exhibit A:
|
None | |
Exhibit B:
|
None | |
Exhibit C-1:
|
Copy of the 2001 Budget of Canada (incorporated by reference from Exhibit C-4 to Canada’s Amendment No. 3 to Form 18-K for the fiscal year ended March 31, 2000) | |
Exhibit C-2:
|
Copy of the Economic and Fiscal Update October 30, 2002, Department of Finance, Canada (incorporated by reference from Exhibit C-2 to Canada’s Amendment No. 1 to Form 18-K for the fiscal year ended March 31, 2001 on Form 18-K/A dated November 1, 2002) | |
Exhibit D:
|
Current Canada Description | |
Exhibit E:
|
Consent of Deputy Minister of Finance |
Table of Contents
Exhibit D
DESCRIPTION OF CANADA
TABLE OF CONTENTS
| Page | ||
General Information
|
3 | |
The Canadian Economy
|
6 | |
External Trade
|
12 | |
Balance of Payments
|
15 | |
Foreign Exchange and International Reserves
|
17 | |
Government Finances
|
18 | |
Debt Record
|
28 | |
Monetary and Banking System
|
29 | |
Tables and Supplementary Information
|
34 |
Unless otherwise indicated, dollar amounts
hereafter in this document are expressed in Canadian dollars.
On December 16, 2002 the noon buying rate in
New York City payable in Canadian dollars (“$”),
as reported by the Federal Reserve Bank of New York, was
$1.00 = $0.6399 United States dollars
(“U.S.$”). See “Foreign Exchange and
International Reserves”.
Table of Contents
2
Table of Contents
The information contained herein has been
reviewed by Kevin G. Lynch, Deputy Minister of Finance,
Canada and is included herein on his authority. Certain
information contained in this Exhibit has been extracted or
compiled from public official documents of Canada, which include
statistical data subject to revision. Canada is sometimes
referred to as the “Government of Canada” or the
“Government” in this Exhibit.
CANADA
GENERAL INFORMATION
Area and Population
Canada is the second largest country in the
world, with an area of 9,984,670 square kilometers of which
about 891,163 square kilometers are covered by fresh water.
The occupied farm land is about 7% and the productive
forest land is about 24% of the total area.
The population on July 1, 2002 was estimated to be
31.4 million. Approximately 64% of Canada’s population
lives in metropolitan areas of which Toronto, Montreal and
Vancouver are the largest. Most of Canada’s population
lives within 325 kilometers of the United States
border.
Form of Government
Canada is a federal state composed of ten
provinces and three territories. In 1867, the United Kingdom
Parliament adopted the British North America Act, which
established the Canadian federation comprised of, at that time,
the Provinces of Ontario, Québec, Nova Scotia and New
Brunswick. Since then, six additional provinces (Manitoba,
British Columbia, Prince Edward Island, Saskatchewan, Alberta
and Newfoundland and Labrador), along with the Yukon Territory,
the Northwest Territories and the new territory of Nunavut
(which was carved out of the Northwest Territories on
April 1, 1999), have become parts of Canada.
The British North America Act (which has
been renamed the Constitution Act, 1867) gave the
Parliament of Canada legislative power in relation to a number
of matters including all matters not assigned exclusively to the
legislatures of the provinces. These powers now include matters
such as defense, the raising of money by any mode or system of
taxation, the regulation of trade and commerce, the public debt,
money and banking, interest, bills of exchange and promissory
notes, navigation and shipping, extra-provincial transportation,
aerial navigation and, with some exceptions, telecommunications.
The provincial legislatures have exclusive jurisdiction in such
areas as education, municipal institutions, property and civil
rights, administration of justice, direct taxation for
provincial purposes and other matters of purely provincial or
local concern.
The executive power of the federal Government is
vested in the Queen, represented by the Governor General, whose
powers are exercised on the advice of the federal Cabinet, which
is responsible to the House of Commons. The legislative branch
at the federal level, Parliament, consists of the Crown, the
Senate and the House of Commons. The Senate has 105 seats.
There are 24 seats each for the Maritime Provinces,
Québec, Ontario and Western Canada, 6 for Newfoundland and
1 each for the three territories. Senators are appointed by the
Governor General on the advice of the federal Cabinet and hold
office until age 75. The House of Commons has
301 members, elected by voters in single-member
constituencies. The leader of the political party that gains the
most seats in each general election is usually invited by the
Governor General to be Prime Minister and to form the
Government. The Prime Minister selects the members of the
federal Cabinet from among the members of the House of Commons
and the Senate (in practice almost entirely from the former).
The House of Commons is elected for a period of five years,
subject to earlier dissolution upon the recommendation of the
Prime Minister or because of the Government’s defeat in the
House of Commons on a vote of no confidence.
The most recent general election was held on
November 27, 2000. As a result of that election the
Liberal Party forms the Government. The distribution of seats in
the House of Commons is as follows: the Liberal Party has
169 seats, the Canadian Alliance Party has 63 seats,
the Bloc Québécois has 35 seats, the
New Democratic Party has 14 seats and the Progressive
Conservative Party has 14 seats. There are
3 independent members and 3 vacant seats.
The executive power in each province is vested in
the Lieutenant Governor, appointed by the Governor General on
the advice of the federal Cabinet. The Lieutenant
Governor’s powers are exercised on the advice of the
provincial cabinet, which is responsible to the legislative
assembly. Each provincial legislature is composed of a
Lieutenant Governor and a legislative assembly made up of
members elected for a period of five years.
The practice of selecting the provincial premier and the
provincial cabinet in each province follows that described for
the federal level, as does dissolution of a legislature.
Table of Contents
The judicial branch of government in Canada is
composed of an integrated set of courts created by federal and
provincial law. At the federal level there are two principal
courts, the Supreme Court of Canada which is the highest appeal
court in Canada and the Federal Court of Canada which, among
other things, deals with federal revenue laws and claims
involving the Government. Judges of the two federally
constituted courts and those of the provincial superior and
county courts are appointed by the Governor General on the
advice of the federal Cabinet and hold office during good
behavior until age 70 or 75. Judges of the magistrates courts
(commonly now known as provincial courts) are appointed by the
provincial government and usually hold office until age 65 or 70.
Constitutional Reform
In April 1982, Her Majesty the Queen proclaimed
the Constitution Act, 1982, terminating British
legislative jurisdiction over Canada’s Constitution. The
Constitution Act, 1982 provides that Canada’s
Constitution may be amended pursuant to an amending formula
contained therein and contains the Canadian Charter of Rights
and Freedoms, including the linguistic rights of Canada’s
two major language groups.
The government of Québec did not sign the
constitutional agreement which led to the repatriation of the
Canadian Constitution and the proclamation of the
Constitution Act, 1982. Although Québec is legally
bound by the Constitution Act, 1982, the government of
Québec set out five conditions for accepting the legal
legitimacy of the Act. Discussions on those principles led on
April 30, 1987 at Meech Lake to a unanimous agreement by
First Ministers on principles respecting each of
Québec’s conditions.
A constitutional resolution to give effect to the
Meech Lake Accord was adopted by Parliament and eight provinces
before the deadline for ratification on June 23, 1990. In
the absence of ratification by Newfoundland and Manitoba, the
amendment was not adopted. In the wake of this event, the most
extensive series of public consultations on constitutional
matters ever to occur in Canada began through the work of both
provincial and federal commissions and committees, among other
things. Recommendations produced by this process were then
assessed by a series of multilateral negotiations involving the
federal, provincial and territorial governments and four
national Aboriginal organizations, held from April to July 1992.
Agreement was reached on a wide range of constitutional issues
through the multilateral process which led to a First
Ministers’ Conference held in Charlottetown in August 1992.
The Charlottetown Accord was an extensive package
of reforms agreed upon by the federal, provincial and
territorial governments and the four Aboriginal organizations.
On October 26, 1992 Canadians were asked in a referendum if
they agreed that the Constitution of Canada should be renewed on
the basis of the Charlottetown agreement. A majority of
Canadians in a majority of the provinces, including a majority
in Québec and a majority of Status Indians living on
reserves, declined to provide such a mandate. Consequently,
governments set aside the constitutional issue and announced
their intention to concentrate on social and economic
initiatives that do not require constitutional change.
Québec
Since September 1994, Québec has been
governed by the Parti Québécois, whose platform calls
for Québec’s accession to independence. On
October 30, 1995, the government of Québec held a
consultative referendum under provincial law, seeking a mandate
to secede from Canada and proclaim Québec’s
independence, after having made a formal offer of a new economic
and political partnership between Québec and the rest of
Canada. The government’s proposal was rejected by a vote of
50.6% against and 49.4% in favour, with a participation rate of
93%. While all sides accepted the 1995 referendum results, the
Parti Québécois has not abandoned the goal of
achieving independence for Québec.
The Government of Canada and the governments of
a number of provinces outside Québec have taken
a series of initiatives since the 1995 referendum aimed at
reinforcing Canadian unity, including non-constitutional
measures (notably on provincial responsibility for labour market
programs), demonstrating openness to Québecers’
aspirations, as well as making efforts to clarify the rules
governing any future referendum and the possible consequences of
a Québec secession.
4
Table of Contents
In September 1996, the Government of Canada
referred a series of legal questions to the Supreme Court
of Canada with a view to clarifying, at both domestic and
international law, whether the government of Québec has the
right to secede from Canada unilaterally. On August 20,
1998, the Supreme Court rendered judgment, ruling that the
government of Québec cannot, under either the Constitution
of Canada or international law, legally effect the unilateral
secession of Québec from Canada. The Supreme Court also
stated that, if a clear majority of Québecers were to
clearly and unambiguously express their will to secede, all
governments in Canada would then have a constitutional
obligation to enter into negotiations to address the potential
act of secession as well as its possible terms should, in fact,
secession proceed.
On June 29, 2000, the Government of Canada
enacted a law to give effect to the requirement for clarity set
out in the opinion of the Supreme Court. That law requires the
House of Commons to assess, prior to any future referendum on
the secession of a province, whether the referendum question
made clear that the province would cease to be part of Canada
and become an independent country. The law further requires
that, after the vote itself, the House of Commons also assess
whether there appeared to be a clear majority in support of
the question. Only if both these conditions were met would the
Government of Canada be authorized to enter into negotiations
which might lead to the constitutional amendments required to
effect secession.
In September 1997, the Premiers of the nine
provinces other than Québec met in Calgary to launch public
consultations on a set of declaratory principles, including
a recognition of the unique character of Québec
society within Canada, which seek to frame the fundamental
values underlying the Canadian federation. Over the winter and
spring of 1998, the legislatures of all nine provinces
participating in the Calgary process passed resolutions of
support for the principles set out in the Calgary declaration.
On November 30, 1998, the Parti
Québecois government was re-elected with a majority of
seats (75 out of 125) in Québec’s National Assembly,
though with a vote count of 42% of the votes cast, slightly
below that received by the main opposition party, the federalist
Liberal Party of Québec, which won 48 seats. A third
party, the Action Démocratique du Québec, which
advocates a moratorium on further referenda on secession, took
12% of the votes cast and won 1 seat.
5
Table of Contents
THE CANADIAN ECONOMY*
General
The following chart shows the distribution of
real gross domestic product (“GDP”) at basic prices
(1997 constant dollars) in 2001, which is indicative of the
structure of the economy.
DISTRIBUTION OF REAL GROSS DOMESTIC PRODUCT AT
BASIC PRICES(1)
Percentage Distribution in 2001(2)
Source: Statistics Canada, Gross Domestic
Product by Industry.
(1) GDP is a measure of production
originating within the geographic boundaries of Canada,
regardless of whether factors of production are Canadian or
non-resident owned, whereas gross national product
(“GNP”) measures the value of Canada’s total
production of goods and services — that is, the
earnings of all Canadian owned factors of production.
Quantitatively, GDP is obtained from GNP by adding investment
income paid to non-residents and deducting investment income
received from non-residents. GDP at basic prices represents the
value added by each of the factors of production and is
equivalent to GDP at market prices less indirect taxes (net),
plus other production taxes (net). Moreover, these differences
in GDP measures explain any perceived discrepancies in GDP
growth rates in this document.
(2) May not add to 100.0% due to rounding.
(3) The agriculture, forestry, fishing,
hunting, mining and oil and gas extraction sectors include a
service component.
The volume of industry and sector output in the
following discussion provides “constant dollar”
measures of the contribution of each industry to GDP at basic
prices. The share of service-producing industries in real
GDP was 68.7% in 2001 while the remaining 31.3% was attributed
to goods-producing industries.
| * | Annual figures and year-over-year changes are based upon data that are not seasonally adjusted, except where otherwise indicated. Quarterly and semi-annual figures or changes are based upon seasonally adjusted data, except where otherwise indicated. |
6
Table of Contents
The following table shows the composition of
Canada’s real GDP at basic prices (1997 constant
dollars) by sector in 1987 and over the 1997-2001 period.
REAL GROSS DOMESTIC PRODUCT AT BASIC PRICES BY
INDUSTRY
| For the years ended December 31, | |||||||||||||||||||||||||||||||||||||
| 2001 | 2000 | 1999 | 1998 | 1997 | 1987(2) | 2001 | 1997 | 1987(2) | |||||||||||||||||||||||||||||
| (millions of 1997 dollars) | (percentage distribution) | ||||||||||||||||||||||||||||||||||||
Agriculture
|
$ | 14,617 | $ | 15,975 | $ | 16,437 | $ | 15,230 | $ | 14,016 | $ | 12,090 | 1.5 | % | 1.7 | % | 1.8 | % | |||||||||||||||||||
Forestry, fishing and hunting
|
6,593 | 6,905 | 6,675 | 6,466 | 6,411 | 8,149 | 0.7 | 0.8 | 1.2 | ||||||||||||||||||||||||||||
Mining and oil and gas extraction
|
37,062 | 36,461 | 33,901 | 34,461 | 33,935 | 25,971 | 3.9 | 4.2 | 3.9 | ||||||||||||||||||||||||||||
Manufacturing
|
160,935 | 168,825 | 160,150 | 149,390 | 142,282 | 112,727 | 17.0 | 17.4 | 17.1 | ||||||||||||||||||||||||||||
Construction
|
50,346 | 48,498 | 46,529 | 44,348 | 42,995 | 44,241 | 5.3 | 5.3 | 6.7 | ||||||||||||||||||||||||||||
Utilities
|
27,288 | 27,960 | 26,705 | 26,140 | 26,685 | 23,010 | 2.9 | 3.3 | 3.5 | ||||||||||||||||||||||||||||
Transportation and warehousing
|
44,531 | 45,265 | 43,306 | 41,036 | 40,337 | 31,112 | 4.7 | 4.9 | 4.7 | ||||||||||||||||||||||||||||
Wholesale and retail trade
|
107,243 | 104,256 | 98,508 | 92,644 | 85,946 | 69,290 | 11.3 | 10.5 | 10.5 | ||||||||||||||||||||||||||||
Finance, insurance, real estate and leasing
|
186,989 | 180,834 | 174,227 | 166,070 | 161,097 | 116,387 | 19.7 | 19.7 | 17.7 | ||||||||||||||||||||||||||||
Public administration and defence
|
53,826 | 52,057 | 51,082 | 50,249 | 49,482 | 44,137 | 5.7 | 6.1 | 6.7 | ||||||||||||||||||||||||||||
Community, business and personal services
|
258,678 | 248,390 | 236,044 | 222,929 | 213,622 | 172,959 | 27.3 | 26.2 | 26.3 | ||||||||||||||||||||||||||||
TOTAL (1)
|
$ | 948,108 | $ | 935,426 | $ | 893,564 | $ | 848,963 | $ | 816,808 | $ | 658,425 | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||||||
Source: Statistics Canada, Input Output
Division.
(1) May not add to total due to rounding.
(2) Data does not add to total due to rebasing.
The share of service-producing industries in real
GDP at basic prices increased from 65.7% in 1987 to 68.7% in
2001. The fastest growing groups in this sector have been
wholesale and retail trade and finance, insurance, real estate
and leasing which both grew at average annual rates of 3.3% and
3.5%, between 1987 and 2001, compared to an average annual
growth rate of 2.7% for total real GDP (1997 constant dollars).
The goods-producing sector constituted 31.3% of real GDP at
basic prices in 2001, down from 34.2% in 1987. The decline was
most evident in construction with its share declining from 6.7%
to 5.3%, and in utilities, where the share fell from
3.5% to 2.9%.
Real GDP growth was 3.9% in 1998, 5.2% in 1999
and 4.6% in 2000, while manufacturing output growth exceeded
total output growth over this period, increasing by 4.9% in
1998, 7.2% in 1999 and by 4.7% in 2000. Total year-over-year GDP
growth slowed in 2001, increasing by 1.4%, but has rebounded in
2002 to date, increasing by 1.9%, 2.5% and 3.6% in the first,
second and third quarter respectively.
On a year-over-year basis, manufacturing output
contracted by 4.6% in 2001, and by 1.3% in the first quarter of
2002, before rising by 1.2% and 5.0% in the second and third
quarter respectively.
The construction sector was the second largest
goods-producing sector in Canada in 2001. Construction activity
rose by 3.3% in 1998, 4.7% in 1999, 4.2% in 2000 and 3.9%
in 2001. Construction output grew 4.4% year-over-year in
the first quarter of 2002, 4.7% in the second quarter and 5.5%
in the third quarter.
Output from mining and oil and gas extractions
increased at a rate of 1.5% in 1998. Output fell by 0.7% in
1999, rebounded by 7.8% in 2000 and moderated to 1.7%
in 2001. In 2002, year-over-year growth fell by 1.1%
in the first quarter, 2.9% in the second quarter and 0.6% in the
third quarter.
Although the share of agricultural output in
total real GDP in 2001 was 1.5%, agriculture is an important
part of Canada’s economy and a significant contributor to
foreign exchange earnings. Wheat is Canada’s principal
agricultural crop and one of its largest export products by
value. The wheat crop was 24.3 million tonnes in the
1997-98 crop year, 24.1 million tonnes in the 1998-1999
crop year, 26.9 million tonnes in the 1999-2000 crop year
and 26.5 million tonnes in the 2000-2001 crop year. Total
wheat production fell to 20.6 million tonnes in the
2001-2002 crop year. Statistics Canada estimates that the
2002-2003 crop year will be one of the worst growing seasons in
recent history in Western Canada with wheat production estimated
at only 15.5 million tonnes due to exceptionally
dry conditions.
| * | Unless otherwise specified, all growth rates are calculated using real GDP at basic prices, 1997 chained dollars. All percentage changes are compounded at annual rates. For percentage changes over more than one year the method of computation utilizes observations for the first and final years indicated. For percentage changes over less than one year the method of calculation utilizes observations for the period stated and the previous period of the same length. |
7
Table of Contents
Gross Domestic Income and
Expenditure
Real GDP continued to trend upward from 1997 to
2000, growing by 4.2% in 1997, 4.1% in 1998, 5.4% in 1999, and
4.5% in 2000, while nominal GDP grew by 5.5% in 1997, 3.7% in
1998, 7.2% in 1999 and 8.6% in 2000. Real and nominal GDP growth
tapered off in 2001 increasing by 1.5% and 2.6% respectively. In
the first three quarters of 2002, real GDP rebounded by 2.1%,
3.1% and 4.0% respectively (year-over-year); nominal GDP growth
was 0.5%, 3.4% and 6.1% respectively.
GROSS DOMESTIC INCOME AND EXPENDITURE
| First 3 quarters (10) | For the years ending December 31, | |||||||||||||||||||||||||||||||
| 2002 | 2001 | 2001 | 2000 | 1999 | 1998 | 1997 | ||||||||||||||||||||||||||
| (in millions of dollars) | ||||||||||||||||||||||||||||||||
INCOME
|
||||||||||||||||||||||||||||||||
Labor income (1)
|
$ | 590,485 | $ | 567,163 | $ | 568,864 | $ | 545,110 | $ | 502,726 | $ | 475,335 | $ | 453,073 | ||||||||||||||||||
Corporate profits (2)
|
121,197 | 123,876 | 118,227 | 129,821 | 108,745 | 86,132 | 87,932 | |||||||||||||||||||||||||
Non-farm unincorporated business income
|
71,745 | 66,104 | 66,551 | 63,962 | 61,351 | 57,936 | 54,663 | |||||||||||||||||||||||||
Farm income
|
1,977 | 2,976 | 2,972 | 1,758 | 1,935 | 1,724 | 1,663 | |||||||||||||||||||||||||
Other net domestic income (3)
|
58,155 | 65,171 | 63,386 | 62,334 | 53,887 | 53,461 | 54,911 | |||||||||||||||||||||||||
Net domestic income
|
896,588 | 877,841 | 872,577 | 854,701 | 779,285 | 723,487 | 700,063 | |||||||||||||||||||||||||
Indirect taxes, capital consumption
|
||||||||||||||||||||||||||||||||
allowances and residual error
|
235,445 | 217,973 | 219,669 | 210,294 | 201,239 | 191,486 | 182,670 | |||||||||||||||||||||||||
GROSS DOMESTIC INCOME
|
$ | 1,132,033 | $ | 1,095,814 | $ | 1,092,246 | $ | 1,064,995 | $ | 980,524 | $ | 914,973 | $ | 882,733 | ||||||||||||||||||
EXPENDITURE
|
||||||||||||||||||||||||||||||||
Consumer expenditure
|
$ | 645,739 | $ | 618,723 | $ | 620,777 | $ | 594,089 | $ | 560,954 | $ | 531,169 | $ | 510,695 | ||||||||||||||||||
Government expenditure
|
||||||||||||||||||||||||||||||||
(goods & services):
|
||||||||||||||||||||||||||||||||
Federal (4)
|
45,864 | 42,599 | 43,168 | 41,599 | 38,160 | 35,250 | 34,011 | |||||||||||||||||||||||||
Provincial-municipal (5)
|
196,149 | 186,615 | 187,898 | 178,217 | 169,741 | 164,086 | 157,854 | |||||||||||||||||||||||||
Total government (6)
|
242,013 | 229,213 | 231,066 | 219,816 | 207,901 | 199,336 | 191,865 | |||||||||||||||||||||||||
of which current
|
212,763 | 203,111 | 204,492 | 196,004 | 185,317 | 179,317 | 171,756 | |||||||||||||||||||||||||
of which capital (7)
|
29,251 | 26,103 | 26,574 | 23,812 | 22,584 | 20,019 | 20,109 | |||||||||||||||||||||||||
Residential construction
|
61,508 | 51,080 | 52,154 | 48,566 | 45,917 | 42,497 | 43,519 | |||||||||||||||||||||||||
Business fixed investment:
|
||||||||||||||||||||||||||||||||
Non-residential construction
|
51,044 | 52,427 | 52,268 | 50,890 | 46,816 | 45,177 | 43,872 | |||||||||||||||||||||||||
Machinery and equipment
|
84,405 | 87,277 | 85,504 | 86,693 | 79,977 | 74,116 | 67,346 | |||||||||||||||||||||||||
Total
|
135,449 | 139,704 | 137,772 | 137,583 | 126,793 | 119,293 | 111,218 | |||||||||||||||||||||||||
Inventory accumulation:
|
||||||||||||||||||||||||||||||||
Business non-farm
|
2,151 | -1,996 | -4,740 | 8,189 | 4,932 | 5,409 | 9,174 | |||||||||||||||||||||||||
Farm
|
-1,311 | -1,275 | -1,300 | -161 | 55 | -676 | -1,000 | |||||||||||||||||||||||||
Total
|
840 | -3,271 | -6,040 | 8,028 | 4,987 | 4,733 | 8,174 | |||||||||||||||||||||||||
Exports (goods & services) (8)
|
467,080 | 482,611 | 473,000 | 484,331 | 421,796 | 379,203 | 348,604 | |||||||||||||||||||||||||
Imports (goods & services) (9)
|
-419,417 | -422,591 | -416,498 | -428,934 | -388,157 | -360,871 | -331,271 | |||||||||||||||||||||||||
Residual error of estimate
|
-1,179 | 345 | 15 | 1,516 | 333 | -387 | -71 | |||||||||||||||||||||||||
GROSS DOMESTIC EXPENDITURE
|
$ | 1,132,033 | $ | 1,095,815 | $ | 1,092,246 | $ | 1,064,995 | $ | 980,524 | $ | 914,973 | $ | 882,733 | ||||||||||||||||||
GROSS DOMESTIC EXPENDITURE IN 1997 CHAIN-FISHER
DOLLARS (11)
|
$ | 1,057,402 | $ | 1,025,802 | $ | 1,027,523 | $ | 1,012,335 | $ | 968,451 | $ | 918,910 | $ | 882,733 | ||||||||||||||||||
Source: Statistics Canada, National Income and
Expenditure Accounts.
(1) Includes military pay and allowances.
(2) Includes net interest and
dividends paid to non-residents.
(3) Includes interest, miscellaneous
investment income and government business enterprise profits
before taxes.
(4) Net spending (outlays minus sales)
including gross capital formation and Canada Pension Plan.
(5) Net spending (outlays minus sales)
including gross capital formation and Québec Pension Plan.
(6) Includes government inventories.
(7) Includes inventory accumulations
at all levels of government.
(8) Excludes investment income
received from non-residents.
(9) Excludes investment income paid to
non-residents.
(10) Seasonally adjusted, annual rates.
| (11) | A new formula (Chain-Fisher) is now used to estimate the level of real GDP. This new formula replaces the previous Laspeyres formula. |
8
Table of Contents
Economic Developments*
Nominal GDP at market prices was about
$1.1 trillion in 2001. Real output growth experienced gains
of 4.2% in 1997, 4.1% in 1998, 5.4% in 1999 and 4.5% in 2000,
before slowing to 1.5% in 2001. Year-over-year real GDP growth
rebounded in 2002 to date, registering 2.1% in the first
quarter, 3.1% in the second quarter and 4.0% in the third
quarter.
Real consumer spending rose by 4.6% in 1997, 2.8%
in 1998, 3.9% in 1999, 3.7% in 2000 and 2.6% in 2001.
Year-over-year growth in consumer spending remained robust at
2.1% in the first quarter, 2.7% in the second quarter and 2.9%
in the third quarter of 2002. The personal savings rate declined
steadily between 1991 and 1997, after reaching a peak of 13.8%
in 1991. In 2001, the personal savings rate was 4.6%, increasing
to 5.3% in the first quarter of 2002 and 4.7% in both the second
and third quarter of 2002.
Real non-residential business investment grew at
its highest rate on record in 1997, rising 22.6% before slowing
to 5.3% in 1998. Year-over-year growth in non-residential
business investment was 7.8% in 1999, 8.2% in 2000 and fell by
1.1% in 2001. The strength in non-residential business
investment over this period was largely due to strong increases
in machinery and equipment investment. Year-over-year growth
decreased by 5.2% in the first quarter of 2002, fell by 3.4% in
the second quarter and 4.9% in the third quarter.
Housing starts have generally increased in recent
years. However, the recent levels have tended to be below those
reached in the 1980s. Housing starts rose to 148 thousand
units in 1997, before dropping to 138 thousand units in
1998. Housing starts rebounded in 1999, registering
149 thousand units, and continued rising to
153 thousand units and 163 thousand units in 2000 and
2001 respectively. In the first three quarters of 2002, the
level of housing starts expanded strongly to 204 thousand,
196 thousand and 206 units respectively.
Government spending on current goods and services
contracted between 1994 and 1997 by an average of 0.9% annually.
Growth was 3.2% in 1998, 1.9% in 1999, 2.3% in 2000 and 3.3% in
2001. Year-over-year growth in government spending on goods and
services for 2002 was 2.5% in the first quarter, 2.0% in the
second quarter and 2.2% in the third quarter.
In current dollar terms, the trade balance was
$16.8 billion in 1997 and $17.4 billion in 1998 before
rising rapidly to $33.1 billion in 1999, $54.7 billion
in 2000 and 55.6 billion in 2001. For 2002 the surplus
at annual rates on the foreign trade balance was
$48.4 billion in the first quarter, $45.0 billion in
the second quarter and $47.4 billion in the third quarter.
(See also “Balance of Payments”.)
| * | In this section all figures are reported in real terms unless otherwise noted. |
Table of Contents
Prices and Costs
The year-over-year increase in the GDP implicit
price deflator declined from 1.2% in 1997, to -0.5% in 1998,
rebounding to 1.7% in 1999, 3.9% in 2000 and 1.0% in 2001.
Year-over-year growth in the implicit price deflator fell by
1.6% for the first quarter of 2002, rose to 0.2% in the
second quarter and increased further to 2.0% in the
third quarter.
The year-over-year increase in the consumer price
index (“CPI”) has been moderate since 1996, with
increases of 1.6% in 1997, 0.9% in 1998 and 1.7% in
1999. After remaining below 2.0% during most of the 1990’s,
the year-over-year increase in the CPI registered 2.7% in 2000
and 2.6% in 2001. The increase in 2000 is largely attributable
to a surge in energy prices, while the increase observed in 2001
was more broadly-based. CPI inflation was lower in the first two
quarters of 2002, at 1.5% and 1.3%, respectively, and edged up
to 2.3% in the third quarter.
PRICE DEVELOPMENTS
| G.D.P. | Consumer Price Index | |||||||||||||||||||||||||||||||
| Implicit | Industrial | |||||||||||||||||||||||||||||||
| Chain | Total | Total Excluding | Product | |||||||||||||||||||||||||||||
| For the years | Price Index | Excluding | Food & | Shelter | Price | |||||||||||||||||||||||||||
| ended December 31, | (1) | Total | Food | Food | Energy | Energy | Services | Index | ||||||||||||||||||||||||
| (annual percentage changes) | ||||||||||||||||||||||||||||||||
1997
|
1.2 | 1.6 | 1.6 | 1.6 | 2.4 | 1.6 | -0.2 | 0.7 | ||||||||||||||||||||||||
1998
|
-0.5 | 0.9 | 1.6 | 0.9 | -4.0 | 1.3 | 0.5 | 0.4 | ||||||||||||||||||||||||
1999
|
1.7 | 1.7 | 1.3 | 1.7 | 5.7 | 1.5 | 1.1 | 1.8 | ||||||||||||||||||||||||
2000
|
3.9 | 2.7 | 1.4 | 3.1 | 16.2 | 1.5 | 2.1 | 4.3 | ||||||||||||||||||||||||
2001
|
1.0 | 2.6 | 4.5 | 2.1 | 3.3 | 2.0 | 2.5 | 1.0 | ||||||||||||||||||||||||
2001 Q4
|
-1.2 | 1.1 | 3,9 | 0.5 | -8.9 | 1.7 | 2.1 | -1.9 | ||||||||||||||||||||||||
2002 Q1
|
-1.6 | 1.5 | 4.1 | 1.0 | -5.4 | 1.9 | 1.7 | -1.1 | ||||||||||||||||||||||||
2002 Q2
|
0.2 | 1.3 | 2.6 | 1.1 | -8.7 | 2.4 | 1.8 | -1.5 | ||||||||||||||||||||||||
2002 Q3
|
2.0 | 2.3 | 2.0 | 2.4 | -1.6 | 3.0 | 1.8 | 0.3 | ||||||||||||||||||||||||
Source: Statistics Canada, National Income and
Expenditure Accounts; Consumer Prices and Price Indexes;
Industry Price Indexes.
(1) This implicit price index is based on
seasonally adjusted data.
The average annual increase in new collective
agreements (without cost of living clauses) involving 500 or
more employees for all industries was 3.1% in 2001. Average wage
gains (over the life of the contract) have increased steadily
since 1996. The average settlement was 1.5% in 1997, 1.7% in
1998, 2.2% in 1999 and 2.5% in 2000 and 3.1% in 2001.
Year-over-year, wage gains were 2.9% in the first quarter
of 2002, 2.6% in the second quarter and 2.8% in
the third quarter.
10
Table of Contents
Labor Market
The following table shows labor market
characteristics for the periods indicated.
LABOR MARKET CHARACTERISTICS(1)
(thousands of persons)
| Canada | Atlantic Provinces | Québec | ||||||||||||||||||||||||||||||||||
| For the years | Labor | Employ- | Unemploy- | Labor | Employ- | Unemploy- | Labor | Employ- | Unemploy- | |||||||||||||||||||||||||||
| ended December 31, | Force | ment | ment Rate | Force | ment | ment Rate | Force | ment | ment Rate | |||||||||||||||||||||||||||
1997
|
15,153 | 13,774 | 9.1 | 1,096 | 944 | 13.9 | 3,606 | 3,195 | 11.4 | |||||||||||||||||||||||||||
1998
|
15,418 | 14,140 | 8.3 | 1,115 | 971 | 12.9 | 3,660 | 3,282 | 10.3 | |||||||||||||||||||||||||||
1999
|
15,721 | 14,531 | 7.6 | 1,136 | 1,003 | 11.7 | 3,702 | 3,357 | 9.3 | |||||||||||||||||||||||||||
2000
|
15,999 | 14,910 | 6.8 | 1,152 | 1,023 | 11.2 | 3,753 | 3,438 | 8.4 | |||||||||||||||||||||||||||
2001
|
16,246 | 15,077 | 7.2 | 1,172 | 1,035 | 11.7 | 3,807 | 3,475 | 8.7 | |||||||||||||||||||||||||||
2001 Q4
|
16,347 | 15,094 | 7.7 | 1,183 | 1,044 | 11.7 | 3,844 | 3,493 | 9.1 | |||||||||||||||||||||||||||
2002 Q1
|
16,490 | 15,199 | 7.8 | 1,190 | 1,047 | 12.1 | 3,884 | 3,530 | 9.1 | |||||||||||||||||||||||||||
2002 Q2
|
16,605 | 15,339 | 7.6 | 1,193 | 1,059 | 11.2 | 3,930 | 3,602 | 8.3 | |||||||||||||||||||||||||||
2002 Q3
|
16,743 | 15,470 | 7.6 | 1,193 | 1,056 | 11.5 | 3,934 | 3,599 | 8.5 | |||||||||||||||||||||||||||
| Ontario | Prairie Provinces | British Columbia | ||||||||||||||||||||||||||||||||||
| For the years | Labor | Employ- | Unemploy- | Labor | Employ- | Unemploy- | Labor | Employ- | Unemploy- | |||||||||||||||||||||||||||
| ended December 31, | Force | ment | ment Rate | Force | ment | ment Rate | Force | ment | ment Rate | |||||||||||||||||||||||||||
1997
|
5,801 | 5,313 | 8.4 | 2,609 | 2,454 | 6.0 | 2,040 | 1,869 | 8.4 | |||||||||||||||||||||||||||
1998
|
5,914 | 5,490 | 7.2 | 2,677 | 2,527 | 5.6 | 2,051 | 1,870 | 8.8 | |||||||||||||||||||||||||||
1999
|
6,071 | 5,688 | 6.3 | 2,734 | 2,576 | 5.8 | 2,079 | 1,906 | 8.3 | |||||||||||||||||||||||||||
2000
|
6,228 | 5,872 | 5.7 | 2,766 | 2,628 | 5.0 | 2,100 | 1,949 | 7.2 | |||||||||||||||||||||||||||
2001
|
6,364 | 5,963 | 6.3 | 2,799 | 2,662 | 4.9 | 2,104 | 1,942 | 7.7 | |||||||||||||||||||||||||||
2001 Q4
|
6,399 | 5,965 | 6.8 | 2,814 | 2,674 | 5.0 | 2,107 | 1,918 | 9.0 | |||||||||||||||||||||||||||
2002 Q1
|
6,454 | 5,996 | 7.1 | 2,837 | 2,691 | 5.2 | 2,125 | 1,936 | 8.9 | |||||||||||||||||||||||||||
2002 Q2
|
6,479 | 6,025 | 7.0 | 2,857 | 2,699 | 5.5 | 2,147 | 1,954 | 9.0 | |||||||||||||||||||||||||||
2002 Q3
|
6,558 | 6,083 | 7.2 | 2,888 | 2,736 | 5.3 | 2,171 | 1,996 | 8.1 | |||||||||||||||||||||||||||
Source: Statistics Canada, The Labour
Force.
(1) Unemployment levels are calculated using the
difference between Labour Force and Employment for the quarters.
On a year-over-year basis, employment has
increased steadily since 1993, although more so since 1997.
The labor force has also grown steadily since 1993
(on a year-over-year basis). Employment rose by 0.8% in
1996, while the labor force increased by 1.0% over the same
period. Employment then averaged more than two percent
growth, growing by 2.3%, 2.7%, 2.8% and 2.6% respectively
in 1997 to 2000, before slowing to 1.1% in 2001. Growth in
the labor force was not as strong, registering growth of 1.7%,
1.8%, 2.0%, 1.8%, 1.5% in 1997 through 2001 respectively.
Year-over-year employment growth in 2002 to date was 1.0% in the
first quarter, 1.7% in the second quarter and 2.6% in the third
quarter. Growth in the labor force was 1.9%, 2.3% and 3.1%
respectively over the same period.
After its most recent peak of 11.4% in 1993, the
unemployment rate has generally trended downward through 2000.
The unemployment rate bottomed out at 6.8% in 2000 and rose to
7.2% in 2001. The unemployment rate reached a peak of 7.8% in
the first quarter of 2002, fell to 7.6% in the second quarter
and remained at this level in the third quarter.
11
Table of Contents
EXTERNAL TRADE
Canada has been successful in implementing its
trade goals of freer and more open markets based on
internationally-agreed rules and practices at multilateral,
regional and bilateral levels.
At the multilateral level, Canada continues to be
an active member of the World Trade Organization
(“WTO”) and is fully participating in multilateral
trade negotiations launched in Doha, Qatar in
November 2001. Since the conclusion of the last round of
multilateral trade negotiations in 1995, Canada has taken
a number of actions to liberalize its trade regimes. Canada
has reduced tariffs on a wide range of products and also
expanded product coverage for duty-free access for products of
least-developed countries. The WTO has served as a forum
for trade negotiations, including the accession of new members,
the pursuit of sectoral liberalization (such as the
post-Uruguay Round WTO Ministerial Declaration on Trade in
Information Technology Products — Information
Technology Agreement and the Fifth Protocol to the General
Agreement on Trade in Services — Financial Services
Agreement), and the current Doha mandated negotiations,
including non-agricultural market access negotiations.
Also, Canada continues to participate fully in the ongoing
agriculture and services negotiations.
At the regional level, Canada is a member of the
North American Free Trade Agreement (“NAFTA”)
with both the United States and Mexico, and has been active
in reducing with a view to eliminating tariffs and non-tariff
barriers, as well as creating disciplines on the regulation of
investment, services, intellectual property, competition and the
temporary entry of business persons. All originating goods
between Canada and the US trade are duty free and virtually all
tariffs on trade in originating goods between Canada and Mexico
are to be eliminated by January 1, 2003. Canada is
also one of the 34 democratic countries in the hemisphere
currently engaged in negotiating the Free Trade Area of the
Americas Agreement. The negotiations, launched in
April 1998, hold the potential to create the world’s
largest free trade area, with 800 million people and
a combined gross domestic product of nearly
$17 trillion. Canada is also an active participant in the
broader hemispheric Summit of the Americas initiative that
addresses social development, including the promotion of
democracy, sustainable development, protection of the
environment, human rights and poverty reduction.
At the bilateral level, since 1997, Canada has
had a free trade agreement with Israel covering trade in
goods. On originating goods between Canada and Chile,
tariffs continue to be eliminated under the 1997
Canada-Chile Free Trade Agreement such that virtually all
tariffs will be eliminated by 2003. Canada signed
a free trade agreement with Costa Rica in
April 2001 which was implemented in November 2002, and
is engaged in free trade negotiations with the Central American
Four (Honduras, Nicaragua, Guatemala and El Salvador) and
with Singapore. Canada is also engaged in trade negotiations
with the European Free Trade Association (“EFTA”)
countries (Switzerland, Norway, Iceland and Liechtenstein).
As well, Canada is exploring the possibility of free trade
negotiations with the Dominican Republic and five Andean nations
(Columbia, Bolivia, Ecuador, Venezuela and Peru).
12
Table of Contents
Merchandise Trade
The following table sets forth the composition of
Canadian trade for the periods indicated.
THE COMPOSITION OF CANADIAN MERCHANDISE TRADE
(Balance of Payments Basis)
| First 3 quarters (2) | For the years ended December 31, | ||||||||||||||||||||||||||||
| 2002 | 2001 | 2001 | 2000 | 1999 | 1998 | 1997 | |||||||||||||||||||||||
| (in millions) | |||||||||||||||||||||||||||||
Value of Exports
|
|||||||||||||||||||||||||||||
Wheat
|
$ | 2,459 | $ | 2,703 | $ | 3,807 | $ | 3,609 | $ | 3,356 | $ | 3,642 | 5,052 | ||||||||||||||||
Other agricultural products
|
18,720 | 18,084 | 24,310 | 21,303 | 19,484 | 18,148 | 17,234 | ||||||||||||||||||||||
Crude petroleum
|
12,992 | 12,276 | 15,370 | 19,166 | 11,017 | 7,830 | 10,366 | ||||||||||||||||||||||
Natural gas
|
13,389 | 22,199 | 25,595 | 20,537 | 10,951 | 8,967 | 8,626 | ||||||||||||||||||||||
Ores and metals
|
21,051 | 19,334 | 25,763 | 26,471 | 23,434 | 25,308 | 26,062 | ||||||||||||||||||||||
Lumber
|
8,198 | 8,670 | 11,392 | 12,045 | 13,154 | 11,529 | 12,876 | ||||||||||||||||||||||
Pulp and paper
|
9,539 | 11,417 | 14,645 | 16,504 | 13,440 | 12,898 | 13,254 | ||||||||||||||||||||||
Other materials
|
51,363 | 54,686 | 70,850 | 70,435 | 59,713 | 55,140 | 50,220 | ||||||||||||||||||||||
Motor vehicles
|
52,108 | 49,713 | 65,862 | 69,676 | 70,459 | 55,859 | 50,127 | ||||||||||||||||||||||
Motor vehicle parts
|
21,998 | 20,153 | 26,999 | 28,436 | 26,833 | 22,603 | 19,343 | ||||||||||||||||||||||
Machinery
|
14,665 | 14,388 | 19,231 | 18,790 | 17,059 | 17,491 | 15,371 | ||||||||||||||||||||||
Other end products
|
69,285 | 73,384 | 96,474 | 103,907 | 84,553 | 75,778 | 64,289 | ||||||||||||||||||||||
Special transactions
|
10,857 | 10,915 | 14,339 | 14,708 | 13,718 | 11,969 | 10,558 | ||||||||||||||||||||||
TOTAL EXPORTS (1)
|
$ | 306,624 | $ | 317,922 | $ | 414,638 | $ | 425,587 | $ | 367,171 | $ | 327,162 | $ | 303,378 | |||||||||||||||
Value of Imports
|
|||||||||||||||||||||||||||||
Edible products
|
$ | 15,351 | $ | 14,193 | $ | 19,072 | $ | 17,390 | $ | 16,552 | $ | 16,093 | $ | 14,547 | |||||||||||||||
Crude petroleum
|
8,366 | 10,478 | 12,815 | 13,437 | 7,160 | 5,227 | 7,189 | ||||||||||||||||||||||
Other crude materials
|
6,481 | 6,129 | 8,125 | 8,041 | 7,156 | 7,249 | 6,982 | ||||||||||||||||||||||
Fabricated materials
|
51,800 | 52,966 | 69,444 | 71,091 | 62,412 | 60,113 | 54,508 | ||||||||||||||||||||||
Motor vehicles
|
27,331 | 23,517 | 31,810 | 32,475 | 30,242 | 27,283 | 26,287 | ||||||||||||||||||||||
Motor vehicle parts
|
33,304 | 30,783 | 40,735 | 44,956 | 45,692 | 39,506 | 34,539 | ||||||||||||||||||||||
Machinery and equipment
|
78,961 | 86,653 | 112,422 | 122,787 | 108,248 | 101,124 | 91,339 | ||||||||||||||||||||||
Other end products
|
34,423 | 32,141 | 42,927 | 40,109 | 36,999 | 34,576 | 29,766 | ||||||||||||||||||||||
Special transactions
|
9,232 | 10,005 | 13,274 | 13,147 | 12,501 | 12,226 | 12,569 | ||||||||||||||||||||||
TOTAL IMPORTS (1)
|
$ | 265,248 | $ | 266,864 | $ | 350,623 | $ | 363,432 | $ | 326,961 | $ | 303,399 | $ | 277,727 | |||||||||||||||
Source: Statistics Canada, Canadian
International Merchandise Trade.
(1) May not add to total due to rounding.
(2) Seasonally adjusted.
Canada is one of the leading trading nations of
the world. Canada’s exports have always reflected the
country’s high endowment in natural resources. However,
Canada has been diversifying its exports over time, relying less
on commodities and more on finished goods. The value of
commodity exports as a share of total exports dropped from 69%
in 1980 to 45.0% in the first three quarters of 2002. Over this
period the increase in exports of finished goods was led by
automotive and miscellaneous end products. Canada’s imports
consist mostly of manufactured goods; the two main components
are machinery and equipment and automotive products.
Canada and the United States are each
other’s largest trading partners, reflecting the physical
proximity of the two countries and their close economic and
financial relationship. In 2001, trade with the United
States accounted for 84.6% of the value of Canada’s
merchandise exports and 72.7% of the value of Canada’s
merchandise imports. According to the United States
Department of Commerce, trade with Canada accounted for 22.7% of
the United States’ exports and 19.1% of its imports
in 2001.
13
Table of Contents
GEOGRAPHICAL DISTRIBUTION OF CANADIAN MERCHANDISE
TRADE
(Balance of Payments Basis)
| First 3 quarters | For the years ending December 31, | ||||||||||||||||||||||||||||
| 2002 | 2001 | 2001 | 2000 | 1999 | 1998 | 1997 | |||||||||||||||||||||||
Exports (1)
|
|||||||||||||||||||||||||||||
United States
|
84.9 | % | 84.8 | % | 84.6 | % | 84.5 | % | 84.2 | % | 82.3 | % | 79.9 | % | |||||||||||||||
Japan
|
2.3 | 2.3 | 2.3 | 2.5 | 2.7 | 3.0 | 3.9 | ||||||||||||||||||||||
United Kingdom
|
1.5 | 1.6 | 1.6 | 1.6 | 1.6 | 1.6 | 1.5 | ||||||||||||||||||||||
European Union (2)
|
3.7 | 3.8 | 3.8 | 3.8 | 3.8 | 4.3 | 4.4 | ||||||||||||||||||||||
Other
|
7.6 | 7.5 | 7.7 | 7.6 | 7.7 | 8.8 | 10.2 | ||||||||||||||||||||||
| 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||||
Imports (1)
|
|||||||||||||||||||||||||||||
United States
|
71.9 | % | 72.8 | % | 72.7 | % | 73.7 | % | 76.3 | % | 77.1 | % | 76.1 | % | |||||||||||||||
Japan
|
3.3 | 3.0 | 3.0 | 3.2 | 3.2 | 3.2 | 3.1 | ||||||||||||||||||||||
United Kingdom
|
2.9 | 3.4 | 3.4 | 3.4 | 2.4 | 2.0 | 2.2 | ||||||||||||||||||||||
European Union (2)
|
7.2 | 6.5 | 6.6 | 5.8 | 6.4 | 6.3 | 6.5 | ||||||||||||||||||||||
Other
|
14.8 | 14.4 | 14.2 | 13.9 | 11.8 | 11.4 | 12.0 | ||||||||||||||||||||||
| 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||||
Source: Statistics Canada, Canadian
International Merchandise Trade.
| (1) | May not add to total due to rounding. |
| (2) | Excludes the United Kingdom. Includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and Sweden. |
The following table presents volume and price
indices of Canada’s merchandise trade for the periods
indicated.
MERCHANDISE TRADE INDICES
(Balance of Payments Basis)
| First 3 quarters | For the years ending December 31, | ||||||||||||||||||||||||||||
| 2002 | 2001 | 2001 | 2000 | 1999 | 1998 | 1997 | |||||||||||||||||||||||
| (1997 = 100) | |||||||||||||||||||||||||||||
Indices of physical volume
|
|||||||||||||||||||||||||||||
Exports
|
127.0 | 126.2 | 125.6 | 130.9 | 120.6 | 108.5 | 100.0 | ||||||||||||||||||||||
Imports
|
118.9 | 119.6 | 117.9 | 125.4 | 115.1 | 106.1 | 100.0 | ||||||||||||||||||||||
Indices of prices
|
|||||||||||||||||||||||||||||
Exports
|
106.1 | 110.6 | 108.8 | 107.1 | 100.3 | 99.4 | 100.0 | ||||||||||||||||||||||
Imports
|
107.1 | 107.2 | 107.1 | 104.4 | 102.3 | 103.0 | 100.0 | ||||||||||||||||||||||
Terms of trade (1)
|
99.1 | 103.2 | 101.6 | 102.6 | 98.0 | 96.5 | 100.0 | ||||||||||||||||||||||
Source: Statistics Canada, National Income and
Expenditure Accounts.
(1) Index of price of exports divided by index of
price of imports multiplied by 100.
14
Table of Contents
BALANCE OF PAYMENTS
The following table presents the balance of
international payments for the periods indicated.
BALANCE OF INTERNATIONAL PAYMENTS
| First 3 quarters (1) | For the years ending December 31, | |||||||||||||||||||||||||||||||
| 2002 | 2001 | 2001 | 2000 | 1999 | 1998 | 1997 | ||||||||||||||||||||||||||
| (in millions of dollars) | ||||||||||||||||||||||||||||||||
CURRENT ACCOUNT
|
||||||||||||||||||||||||||||||||
RECEIPTS
|
||||||||||||||||||||||||||||||||
Goods and services
|
$ | 349,137 | $ | 360,657 | $ | 471,250 | $ | 482,731 | $ | 420,210 | $ | 377,385 | $ | 347,133 | ||||||||||||||||||
Goods
|
306,624 | 317,924 | 414,638 | 425,587 | 367,171 | 327,162 | 303,378 | |||||||||||||||||||||||||
Services
|
42,513 | 42,733 | 56,612 | 57,144 | 53,039 | 50,223 | 43,755 | |||||||||||||||||||||||||
Investment income
|
21,657 | 27,848 | 34,990 | 39,815 | 32,913 | 32,338 | 33,252 | |||||||||||||||||||||||||
Current transfers
|
4,968 | 5,167 | 7,024 | 6,097 | 5,644 | 5,054 | 5,029 | |||||||||||||||||||||||||
Current account receipts
|
375,762 | 393,672 | 513,264 | 528,643 | 458,767 | 414,777 | 385,415 | |||||||||||||||||||||||||
PAYMENTS
|
||||||||||||||||||||||||||||||||
Goods and services
|
313,921 | 316,284 | 415,617 | 427,997 | 387,152 | 359,948 | 330,346 | |||||||||||||||||||||||||
Goods
|
265,248 | 266,864 | 350,623 | 363,432 | 326,961 | 303,399 | 277,727 | |||||||||||||||||||||||||
Services
|
48,673 | 49,420 | 64,994 | 64,565 | 60,191 | 56,549 | 52,619 | |||||||||||||||||||||||||
Investment income
|
42,893 | 47,998 | 62,524 | 68,241 | 64,983 | 61,965 | 62,133 | |||||||||||||||||||||||||
Current transfers
|
3,797 | 3,770 | 5,074 | 4,624 | 4,636 | 4,228 | 4,333 | |||||||||||||||||||||||||
Current account payments
|
360,611 | 368,050 | 483,216 | 500,862 | 456,771 | 426,140 | 396,812 | |||||||||||||||||||||||||
BALANCE
|
||||||||||||||||||||||||||||||||
Goods and services
|
35,217 | 44,374 | 55,633 | 54,735 | 33,058 | 17,438 | 16,788 | |||||||||||||||||||||||||
Goods
|
41,377 | 51,060 | 64,016 | 62,155 | 40,210 | 23,763 | 25,652 | |||||||||||||||||||||||||
Services
|
-6,160 | -6,686 | -8,382 | -7,421 | -7,152 | -6,325 | -8,864 | |||||||||||||||||||||||||
Investment income
|
-21,237 | -20,150 | -27,534 | -28,427 | -32,070 | -29,627 | -28,882 | |||||||||||||||||||||||||
Current transfers
|
1,171 | 1,398 | 1,949 | 1,473 | 1,008 | 826 | 697 | |||||||||||||||||||||||||
Current account balance
|
15,151 | 25,622 | 30,049 | 27,781 | 1,996 | -11,363 | -11,397 | |||||||||||||||||||||||||
CAPITAL AND FINANCIAL ACCOUNT
|
||||||||||||||||||||||||||||||||
CAPITAL ACCOUNT
|
4,112 | 4,661 | 5,678 | 5,270 | 5,049 | 4,934 | 7,508 | |||||||||||||||||||||||||
FINANCIAL ACCOUNT
|
-8,800 | -19,864 | -26,596 | -26,788 | -18,241 | -405 | 8,256 | |||||||||||||||||||||||||
CANADIAN ASSETS, NET FLOWS
|
||||||||||||||||||||||||||||||||
Canadian direct investment abroad
|
-28,486 | -47,270 | -54,924 | -70,545 | -23,182 | -50,957 | -31,937 | |||||||||||||||||||||||||
Portfolio investment
|
-19,766 | -32,674 | -37,718 | -62,274 | -23,067 | -22,497 | -11,849 | |||||||||||||||||||||||||
Foreign bonds
|
-6,251 | -2,195 | -1,882 | -3,958 | -2,477 | -7,064 | -6,642 | |||||||||||||||||||||||||
Foreign stocks
|
-13,514 | -30,479 | -35,836 | -58,316 | -20,590 | -15,433 | -5,207 | |||||||||||||||||||||||||
Other investment
|
-2,449 | 6,917 | -17,743 | -9,610 | 5,540 | 6,292 | -18,760 | |||||||||||||||||||||||||
Loans
|
-1,217 | -1,201 | -7,873 | -5,125 | 2,680 | 12,637 | -18,923 | |||||||||||||||||||||||||
Deposits
|
3,671 | 12,585 | -1,365 | 3,977 | 10,594 | -6,225 | -2,898 | |||||||||||||||||||||||||
Official international reserves
|
-261 | -2,225 | -3,353 | -5,480 | -8,818 | -7,452 | 3,389 | |||||||||||||||||||||||||
Other assets
|
-4,642 | -2,240 | -5,152 | -2,981 | 1,084 | 7,332 | -328 | |||||||||||||||||||||||||
Total Canadian assets, net flows
|
-50,702 | -73,027 | -110,385 | -142,429 | -40,710 | -67,161 | -62,546 | |||||||||||||||||||||||||
CANADIAN LIABILITIES, NET FLOWS
|
||||||||||||||||||||||||||||||||
Foreign direct investment in Canada
|
26,062 | 30,755 | 42,527 | 98,940 | 36,306 | 33,828 | 15,958 | |||||||||||||||||||||||||
Portfolio investment
|
5,357 | 9,660 | 30,868 | 14,025 | 3,255 | 24,779 | 16,181 | |||||||||||||||||||||||||
Canadian bonds
|
9,282 | 15,116 | 33,609 | -22,655 | 2,310 | 10,337 | 6,166 | |||||||||||||||||||||||||
Canadian stocks
|
-3,783 | 3,718 | 4,608 | 34,973 | 14,063 | 14,311 | 7,645 | |||||||||||||||||||||||||
Canadian money market
|
-142 | -9,175 | -7,349 | 1,707 | -13,118 | 130 | 2,369 | |||||||||||||||||||||||||
Other investment
|
10,484 | 12,748 | 10,394 | 2,677 | -17,092 | 8,149 | 38,664 | |||||||||||||||||||||||||
Loans
|
407 | 154 | -7,730 | 2,781 | 6,470 | 3,181 | 1,873 | |||||||||||||||||||||||||
Deposits
|
13,828 | 16,171 | 23,469 | -1,069 | -23,995 | 3,375 | 34,106 | |||||||||||||||||||||||||
Other liabilities
|
-3,751 | -3,577 | -5,345 | 965 | 433 | 1,593 | 2,685 | |||||||||||||||||||||||||
Total Canadian liabilities, net flows
|
41,903 | 53,162 | 83,789 | 115,641 | 22,468 | 66,757 | 70,803 | |||||||||||||||||||||||||
Total capital and financial account, net flow
|
-4,689 | -15,204 | -20,918 | -21,518 | -13,192 | 4,530 | 15,764 | |||||||||||||||||||||||||
Statistical discrepancy
|
-9,823 | -10,695 | -9,130 | -6,264 | 11,196 | 6,833 | -4,367 | |||||||||||||||||||||||||
Source: Statistics Canada, Canada’s
Balance of International Payments.
(1) Year-to-date. Current account data are
seasonally adjusted. Capital account data are not seasonally
adjusted.
15
Table of Contents
Canada’s current account balance improved
from a deficit of $11.4 billion in 1997 to
a surplus of $30.0 billion in 2001. The current
account maintained an average surplus of $20.2 billion
(seasonally adjusted, annualized level) in the first three
quarters of 2002. Over the period since 1997, the three main
components of the current account have evolved as follows:
| (1) The merchandise trade surplus increased from $25.7 billion in 1997 to $64.0 billion in 2001. In the first three quarters of 2002, the merchandise trade surplus averaged $55.2 billion (annualized level). | |
| (2) The service account deficit improved from $8.9 billion in 1997 to $8.4 billion in 2001. The services deficit averaged $8.2 billion (annualized level) in the first three quarters of 2002. | |
| (3) The deficit on net investment income payments narrowed from $28.9 billion in 1997 to $27.5 billion in 2001. The investment income deficit averaged at $28.3 billion in the first three quarters of 2002 (annualized level). |
Low inflation, a depreciation of the
Canadian dollar and good economic growth in the United States
contributed to the increase in the merchandise trade surplus
through 2001. The recent economic slowdown in the
United States has hindered further increases in the first
three quarters of 2002.
In 1997 and 1998, the net inflow in the capital
and financial account stood at $15.8 billion and
$4.5 billion respectively. Following that, Canada
registered net outflows of $13.2 billion,
$21.5 billion and $20.9 billion in 1999, 2000 and
2001. The net inflow in the first three quarters of 2002
averaged $6.3 billion (annualized level).
Various Canadian financial instruments were
acquired by non-residents during the 1990s and early 2000s.
Non-resident net purchases of Canadian bonds, stocks, and money
market instruments amounted to $16.2 billion and
$24.8 billion in 1997 and 1998. After dipping to
$3.3 billion in 1999, purchases of Canadian financial
instruments increased again to $14.0 billion in 2000 and
$30.9 billion in 2001. The first three quarters
of 2002 saw net purchases of Canadian bonds, stocks and
money market instruments average $7.1 billion (annualized
level).
Foreign direct investment in Canada rose from
$16.0 billion in 1997 to $98.9 billion in 2000 before
sliding to $42.5 billion in 2001. Foreign direct
investment in the first three quarters of 2002 averaged at
$34.7 billion (annualized level).
16
Table of Contents
FOREIGN EXCHANGE AND INTERNATIONAL
RESERVES
Since May 31, 1970 the Canadian dollar has been
allowed to float so that the rate of exchange is determined by
conditions of supply and demand in the market. During this
period, the Canadian dollar has floated between a high of 104.43
U.S. cents that occurred in April 1974 and a low of
61.79 U.S. cents in January 2002. The dollar closed
2001 at 62.78 U.S. cents. In 2002 through November 30,
trading has been in a range of 61.79 to 66.54 U.S.
cents; the dollar closed at 63.90 U.S. cents on
November 30, 2002.
EXCHANGE RATE FOR THE CANADIAN DOLLAR
| For the years ended December 31, | ||||||||||||||||||||||||
| 2002 through | ||||||||||||||||||||||||
| November 30 | 2001 | 2000 | 1999 | 1998 | 1997 | 1996 | 1995 | 1994 | 1993 | 1992 | ||||||||||||||
| (in U.S. cents) | ||||||||||||||||||||||||
High
|
66.54 | 67.11 | 69.84 | 69.35 | 71.23 | 74.93 | 75.26 | 75.33 | 76.42 | 80.65 | 87.71 | |||||||||||||
Low
|
61.79 | 62.30 | 63.97 | 64.62 | 63.11 | 69.45 | 72.12 | 70.09 | 70.97 | 74.16 | 77.29 | |||||||||||||
Source: Bank of Canada.
Canada does not have foreign exchange controls.
Foreign exchange operations conducted by the Bank of Canada on
behalf of the Minister of Finance are directed toward the
maintenance of orderly conditions in the foreign exchange market
in Canada through the purchase or sale of United States dollars
for Canadian dollars. The following table shows Canada’s
official international reserves on the dates indicated.
CANADA’S OFFICIAL INTERNATIONAL RESERVES
| At December 31, | ||||||||||||||||||||||||||||||||||||||||||||
| At November 30, | ||||||||||||||||||||||||||||||||||||||||||||
| 2002 | 2001 | 2000 | 1999 | 1998 | 1997 | 1996 | 1995 | 1994 | 1993 | 1992 | ||||||||||||||||||||||||||||||||||
| (in millions of U.S. dollars) | ||||||||||||||||||||||||||||||||||||||||||||
Total
|
36,501 | 34,248 | 32,424 | 28,646 | 23,427 | 17,969 | 20,578 | 15,227 | 12,475 | 12,776 | 11,909 | |||||||||||||||||||||||||||||||||
Source: Department of Finance.
Canada’s official reserves at
November 30, 2002 consisted of United States dollars in the
amount of U.S.$18,419 million, U.S.$218 million in
gold (valued at U.S.$319.05 per fine ounce),
U.S.$3,265 million in the form of the reserve position in
the International Monetary Fund (“IMF”),
U.S.$697 million in Special Drawing Rights
(“SDRs”) and U.S.$13,902 million in other
convertible currencies.
Beginning in 1978 transactions relating to
foreign currency debt undertaken for reserve management purposes
have had an important effect on the level of official reserves.
The Government maintains a U.S.$6,000 million standby
credit facility with a group of foreign banks. Since
August 31, 1986 no drawings have been outstanding on the
standby credit facility. The ”Canada Bills” program
was launched in October 1986. Under this program
U.S. dollar-denominated short-term notes are issued in the
United States money market. There
were U.S.$1,856 million of Canada Bills outstanding on
September 30, 2002. The “Canada Notes” program
was launched in March 1996. Canada Notes are interest-bearing
marketable notes that mature not less than nine months from
their date of issue. As of September 30, 2002, there was
a total of U.S.$859 million equivalent of Canada Notes
outstanding. A Euro Medium Term Note program was launched in
March 1997. As of September 30, 2002, there was
a total of U.S.$2,062 million equivalent of Euro
Medium Term Notes outstanding. As of September 30, 2002,
there was a total of U.S.$11,567 million equivalent of
other marketable bonds, comprised of 8 global bond issues and
5 Petro Canada bond issues assumed by the Government of
Canada on February 5, 2001, on the dissolution of
Petro Canada Limited.
17
Table of Contents
GOVERNMENT FINANCES
Introduction
The financial structure of the Government of
Canada rests on a constitutional and statutory framework dating
back to the British North America Act, 1867. That Act,
which has been renamed the Constitution Act, 1867, gave
constitutional foundation to the principles of financing that
are basic to responsible government, while other necessary
financial administrative machinery and procedures were
established by subsequent legislation, most notably the
Financial Administration Act. The proclamation in 1982 of
the Constitution Act, 1982 terminated British legislative
jurisdiction over Canada’s Constitution in accordance with
an amending formula that permits amendment of the Constitution
without resorting to the Parliament of the United Kingdom.
Within the confines of the Constitution, the
authority of Parliament is supreme. Ultimate control of the
public purse and the financial structure of the Government rests
with Parliament. This is reflected in the fundamental principles
that no tax shall be imposed and no money shall be spent without
the authority of Parliament, and that expenditures shall be made
only for the purposes authorized by Parliament.
Public money received by the Government is
deposited in the Consolidated Revenue Fund of Canada.
Withdrawals of public money out of the Consolidated Revenue Fund
may not be made without the authority of Parliament.
The Government has two major sources of money:
tax and non-tax revenues and borrowing. The main sources of
revenue are personal and corporate income taxes, employment
insurance premiums, and excise taxes and duties. These revenues
are authorized by specific acts passed by Parliament. The other
major source of money to finance Government operations is
borrowing. Borrowing limits are established by acts of
Parliament. The main sources of borrowing are marketable bonds,
treasury bills and Retail Debt.
Parliament authorizes the disbursement of moneys
out of the Consolidated Revenue Fund by means of Appropriation
Acts passed on an annual basis by Parliament and based on the
Main Estimates submitted by the various departments. In addition
to the Appropriation Acts, authority for payments may also be
found in certain statutes which authorize certain payments out
of the Consolidated Revenue Fund. Expenditures for public debt
charges, social security payments and transfers to other levels
of government are authorized in this way. Appropriations may
also be made by the Governor in Council for urgent payments.
Such appropriations may be made only when Parliament is not in
session, and must be laid before Parliament during the
subsequent session.
Information on the Government’s planned
revenues and expenditures is presented to Parliament primarily
in two documents: the Budget and the Main Estimates, which are
both presented in the House of Commons. The Budget, which may be
delivered at any time during the fiscal year, provides the
occasion on which the Minister of Finance generally brings under
review the whole financial position of the Government, present
and prospective, and announces the Government’s plans and
proposals. The Main Estimates are tabled (i.e., introduced) once
each year and outline the Parliamentary authority, either
existing or required, for disbursements. Supplementary Estimates
may also be tabled during the year to provide authority for
spending as the need arises.
The considerations for overall resource
availability and demands for new policies and programs are
reconciled through the establishment of a two year Fiscal Plan
reflecting Government priorities. This Fiscal Plan, which is
presented with the Budget, establishes an expenditure framework,
in which the Cabinet establishes priorities. This ensures that
expenditure decisions are made within the context of Government
priorities and do not exceed the provision for such expenditures
set out in the expenditure framework. The Government also
releases an Economic and Fiscal Update in the fall for
pre-budget consultation purposes.
The reporting entity of the Government of Canada
includes all departments, agencies, corporations and funds which
are owned or controlled by the Government and which are
accountable to Parliament. The
18
Table of Contents
financial activities of all departments,
agencies, corporations and funds are consolidated in the
Government’s financial statements, except for enterprise
Crown corporations and other government business enterprises
which are not dependent on the Government for financing their
activities. For these corporations, the Government reports in
its financial statements only the cost of its investment and an
allowance for valuation which includes their annual net profits
and losses. In addition, any amounts receivable from or payable
to these corporations are reported.
The primary source of information on all actual
financial transactions of the Government is the Public Accounts
of Canada, which are required by the Financial Administration
Act to be tabled in Parliament each year. The other chief
accountability reports are the statements of budgetary and
non-budgetary financial transactions and of the
Government’s cash and debt position published monthly in
The Fiscal Monitor and in the Annual Financial Report.
Fiscal Policy
The era of chronic deficits and rising debt began
in 1974 when productivity and economic growth declined from the
buoyant trend of prior decades. One effect of this fundamental
shift that had taken place in the economy was to reduce the
underlying rate of growth of tax revenues, while expenditure
growth remained strong. Consequently, the divergence between
expenditure and revenue trends produced an uninterrupted string
of deficits until fiscal 1997-98.
The severity of the 1982 recession resulted in a
sharp increase in the deficit in fiscal 1982-83, eventually
peaking at $38.4 billion or 8.5% of GDP in fiscal 1984-85.
During the middle to late 1980s, the Government instituted a
number of measures to increase revenues and constrain the growth
in expenditures. These measures, in conjunction with the
sustained recovery from the 1982 recession, helped to lower the
deficit by about half relative to GDP by fiscal 1990-91. Further
progress was arrested by the onset of the recession in 1990,
which proved to be much longer and more severe than expected.
While the measures to control spending succeeded in preventing
government expenditures from increasing substantially in
response to the recession, the sluggish recovery and the lagged
impact of the recession resulted in substantial declines in
budgetary revenues. This caused the deficit to increase to
$42.0 billion, or 5.8% of GDP, in fiscal 1993-94.
Since 1993, the Government’s fiscal
objective has been to balance the budget. Implicit in this
objective was the need to halt the rise in the debt-to-GDP ratio
and to put it on a permanent downward track. The actions taken
in the 1994, 1995, and 1996 budgets resulted in the elimination
of that deficit in just four years. In fiscal 1997-98, a
budgetary surplus of $3.8 billion was recorded for the
first time in 28 years. This was followed by a surplus of
$3.1 billion in fiscal 1998-99, a surplus of
$12.7 billion in fiscal 1999-2000, a record surplus of
$18.1 billion in fiscal 2000-01 and a surplus of
$8.9 billion in fiscal 2001-02. Coupled with economic
growth, the fiscal turnaround has also led to a fall in the net
public debt as a share of GDP of 21.8 percentage points to
49.1% in fiscal 2001-02, from the peak of 70.9% in fiscal
1995-96. This is the sixth consecutive year in which the
debt-to-GDP ratio has declined.
This turnaround in federal finances underlined
the soundness of the Government’s Debt Repayment
Plan — basing budget plans on two-year rolling fiscal
targets, economic planning projections based on the average of
the private sector economic forecasts backed by fiscal prudence
and fiscal forecasts backed by a Contingency Reserve and
adopting policies which have engendered economic growth and job
creation. Prudence is of two types — the Contingency
Reserve and economic prudence. Prudence in budget planning has
meant that budgetary balance targets have been consistently
bettered in each and every year. The Contingency Reserve of
$3.0 billion per year provides an extra measure of back-up
against adverse errors in the economic forecast. Under the Debt
Repayment Plan, the Contingency Reserve, if not needed, will be
used to pay down the public debt. It is not a source of funds
for new policy initiatives. Economic prudence provides an extra
measure of back-up to ensure that the fiscal target is met. The
economic prudence grows over time.
19
Table of Contents
The budgetary deficit/surplus — the
budgetary balance — is the most comprehensive measure
of the Government’s financial situation as it includes
liabilities incurred by the Government regardless of when the
actual cash payment is made. It is largely presented on an
accrual basis of accounting. However, it is only one measure of
the Government’s financial position.
Another important measure is financial
requirements/surplus. This measures the difference between cash
coming into the Government and cash payments made for programs
and public debt charges during the year. Thus financial
requirements do not include any liabilities incurred by the
Government during the year for which no cash payment has been
made during the year. Financial surpluses have now been recorded
in each of the past six fiscal years. This is in contrast to the
large financial requirements observed from the mid-1970s through
to the mid-1990s. As a result of the financial surpluses, the
Government has retired $34.6 billion of market debt since
fiscal 1996-97.
Summary Statement of
Transactions
The financial transactions of the Government are
classified into four main categories: budgetary, non-budgetary,
foreign exchange and unmatured debt transactions. In general
terms, budgetary transactions are those which enter into the
calculation of the annual surplus or deficit while other
transactions lead to the acquisition or disposal of financial
claims or to the creation or discharge of financial obligations.
The Summary Statement of Transactions table below
sets out the source and use of financial resources for the years
shown.
SUMMARY STATEMENT OF TRANSACTIONS
| For the years ended March 31, | ||||||||||||||||||||||
| 2002 | 2001 | 2000 | 1999 | 1998 | ||||||||||||||||||
| (in millions) | ||||||||||||||||||||||
BUDGETARY TRANSACTIONS
|
||||||||||||||||||||||
Revenues
|
$ | 173,315 | $ | 179,590 | $ | 166,123 | $ | 155,899 | $ | 153,501 | ||||||||||||
Program expenditures
|
–126,673 | –119,348 | –111,763 | –111,393 | –108,753 | |||||||||||||||||
Operating surplus or
deficit ( – )
|
46,642 | 60,242 | 54,360 | 44,506 | 44,748 | |||||||||||||||||
Public debt charges
|
-37,735 | –42,094 | –41,647 | –41,394 | –40,931 | |||||||||||||||||
Surplus or deficit ( – )
|
8,907 | 18,148 | 12,713 | 3,112 | 3,817 | |||||||||||||||||
NON-BUDGETARY TRANSACTIONS
|
||||||||||||||||||||||
Loans, investments and advances
|
–96 | –2,698 | –617 | 330 | 1,605 | |||||||||||||||||
Pensions and other accounts
|
–1,669 | 1,303 | 6,968 | 7,024 | 3,829 | |||||||||||||||||
Other transactions
|
–2,445 | 2,238 | –4,498 | 1,025 | 3,478 | |||||||||||||||||
Net source
|
4,210 | 843 | 1,853 | 8,379 | 8,912 | |||||||||||||||||
Financial requirements ( – )
or source
|
||||||||||||||||||||||
(excluding foreign exchange transactions)
|
4,697 | 18,991 | 14,566 | 11,491 | 12,729 | |||||||||||||||||
FOREIGN EXCHANGE TRANSACTIONS
|
–1,776 | –8,776 | –6,826 | –5,700 | –2,155 | |||||||||||||||||
TOTAL FINANCIAL REQUIREMENTS ( – )
OR SOURCE
|
2,921 | 10,215 | 7,740 | 5,791 | 10,574 | |||||||||||||||||
UNMATURED DEBT TRANSACTIONS
|
–4,132 | –10,003 | –4,021 | –6,864 | –9,561 | |||||||||||||||||
CHANGE IN CASH BALANCE
|
–1,211 | 212 | 3,719 | –1,073 | 1,013 | |||||||||||||||||
CASH BALANCE AT END OF PERIOD (1)
|
$ | 12,026 | $ | 13,237 | $ | 13,025 | $ | 9,306 | $ | 10,379 | ||||||||||||
| Source: | Public Accounts of Canada 2002. |
(1) Numbers do not add up due to rounding.
Budgetary Revenue
The Government reports revenue in the year in
which it is received. Refunds are allocated to the year in which
they are actually paid. Personal income taxes accounted for
about 51% and corporate income taxes accounted for about 15% of
tax revenue in fiscal 2001-02.
The Government announced important changes in
personal and corporate income tax rates in the budget of
February 28, 2000 and the Economic Statement and Budget
Update of October 18, 2000.
Prior to the 2000 announcements, the federal
personal income tax rate structure had three brackets. The
bracket thresholds, together with many credits and other limits,
were indexed for inflation, but since the
20
Table of Contents
beginning of 1986, only for the percentage change
in the CPI exceeding 3%. The February 2000 budget restored full
indexation of the federal personal income tax system effective
January 1, 2000. As a result, for 2002 the basic personal
exemption is $7,634. Regardless of inflation, the basic personal
exemption will be no less than $8,000 by 2004.
The October 2000 budget update added changes that
took effect in 2001. The rates for the existing three brackets
were reduced to 16%, 22% and 26%. A new fourth bracket at the
29% rate applied to taxable income in excess of $100,000, which
is to rise to no less than $113,804 by 2004. For 2002 the tax
thresholds, accounting for indexing, are 16% for income up to
$31,676, 22% for income between $31,677 and $63,353, 26% for
income between $63,354 and $102,999 and 29% for income $103,000
and higher. The 5% high-income surtax was eliminated. The
education tax credit, the disability tax credit, the supplement
to the disability tax credit and the caregiver and infirm
dependent tax credits were all increased. By 2004, the credit
for a dependent spouse or common-law partner credit will be no
less than $6,800.
The 2001 budget included additions such as an
apprentice vehicle mechanics tools tax deduction, a tax
deduction for tuition assistance for adult basic education, the
extension of the education tax credit, improved tax incentives
for renewable energy and energy efficiency, promotion of
sustainable woodlot management and changes to deductibility of
meal costs at construction work camps.
The general federal corporate income tax rate in
Canada in 1999 was 28%. The federal corporate tax rate is 21%
for manufacturing and processing income and 12% for the first
$200,000 of active business income earned by a
Canadian-controlled private corporation. Most corporations are
also subject to a federal surtax equal to 4% of their federal
income tax liability (computed without reference to the small
business deduction and most tax credits). The large corporations
tax is 0.225% of taxable capital employed in Canada in excess of
$10 million. The 4% surtax may be credited against the
large corporations tax liability. An additional capital tax
(effectively a minimum tax since it is creditable against basic
income tax) is levied on large financial institutions.
The February 2000 budget reduced the general
corporate tax rate to 27% beginning in 2001. The October 2000
budget update further reduced the rate to 25% for 2002, 23% for
2003 and 21% after 2003. The budget also reduced the rate on
small business income between $200,000 and $300,000 to 21%
beginning in 2001.
The 2001 budget allowed small businesses to defer
for 6 months payments of corporate tax instalments for
January, February and March 2002 without interest or penalties.
All corporations with taxable capital that did not exceed
$15 million qualified for this deferral.
Prior to the February 2000 budget, capital gains
were taxed to individuals and corporations at three-quarters of
the rate applicable to other income. The February 2000 budget
reduced this inclusion rate to two-thirds, effective
February 28, 2000. The October 2000 budget update reduced
the rate further to one-half, effective October 18, 2000.
The Government imposes a broad based value-added
tax, the Goods and Services Tax (“GST”), at a rate of
7%, to most goods and services. Food for home consumption,
prescription drugs, residential rents, sales of existing houses,
educational services and health care services are generally not
subject to the GST. Excise taxes and duties are imposed on
selected goods, such as tobacco, alcoholic beverages and
gasoline. The Government also imposes customs duties on a wide
range of goods.
In addition, the Government obtains non-tax
revenues in the form of returns on investment from a number of
its Crown corporations. Receipts from sales of goods and
services, fees and permits are other sources of revenue.
21
Table of Contents
The following table sets forth budgetary revenue
for the years shown.
DETAILED STATEMENT OF TRANSACTIONS —
BUDGETARY REVENUES
| For the years ended March 31, | |||||||||||||||||||||
| 2002 | 2001 | 2000 | 1999 | 1998 | |||||||||||||||||
| (in millions) | |||||||||||||||||||||
TAX REVENUES
|
|||||||||||||||||||||
Personal income tax
|
$ | 83,790 | $ | 83,305 | $ | 79,793 | $ | 72,716 | $ | 71,126 | |||||||||||
Corporate income tax
|
24,013 | 28,212 | 23,170 | 21,575 | 22,496 | ||||||||||||||||
Employment insurance premium revenues
|
17,980 | 18,731 | 18,512 | 19,363 | 18,802 | ||||||||||||||||
Other income tax revenues
|
3,035 | 4,312 | 3,499 | 2,901 | 2,974 | ||||||||||||||||
Goods and services tax
|
24,909 | 24,990 | 22,790 | 20,684 | 19,461 | ||||||||||||||||
Customs import duties
|
3,018 | 2,807 | 2,105 | 2,359 | 2,766 | ||||||||||||||||
Other
|
8,711 | 8,319 | 7,991 | 8,356 | 8,633 | ||||||||||||||||
Total tax revenues
|
165,456 | 170,676 | 157,860 | 147,954 | 146,258 | ||||||||||||||||
NON-TAX REVENUES
|
7,859 | 8,914 | 8,263 | 7,945 | 7,243 | ||||||||||||||||
TOTAL BUDGETARY REVENUES
|
$ | 173,315 | $ | 179,590 | $ | 166,123 | $ | 155,899 | $ | 153,501 | |||||||||||
| Source: | Public Accounts of Canada 2002. |
Budgetary Expenditures
Budgetary expenditures encompass the cost of
servicing the public debt, the operating and capital
expenditures of Government departments and agencies, grants and
contributions to other levels of government, organizations and
individuals, and subsidies.
Transfer payments includes a range of federal
social spending programs designed to enhance the quality of life
of Canadians, particularly those who have modest incomes or who
are disadvantaged. It includes income support — most
notably for the elderly and unemployed; transfers to the
provinces for health, education and social assistance; and
programs for aboriginal Canadians.
The following table sets forth budgetary
expenditures, including federal social spending, for the years
shown.
DETAILED STATEMENT OF TRANSACTIONS —
BUDGETARY EXPENDITURES
| For the years ended March 31, | |||||||||||||||||||||||
| 2002 | 2001 | 2000 | 1999 | 1998 | |||||||||||||||||||
| (in millions) | |||||||||||||||||||||||
PROGRAM EXPENDITURES
|
|||||||||||||||||||||||
Transfer payments
|
|||||||||||||||||||||||
Old age security benefits, guaranteed income
supplements and spouses’ allowances
|
$ | 25,365 | $ | 24,256 | $ | 23,410 | $ | 22,781 | $ | 22,225 | |||||||||||||
Employment insurance benefits
|
13,748 | 11,444 | 11,301 | 11,884 | 11,842 | ||||||||||||||||||
Canada health and social transfer
|
17,300 | 13,500 | 14,891 | 16,018 | 12,421 | ||||||||||||||||||
Fiscal arrangements
|
11,603 | 12,467 | 10,721 | 11,645 | 10,000 | ||||||||||||||||||
Other transfers to governments
|
375 | 217 | — | 2 | 162 | ||||||||||||||||||
Canada Assistance Plan
|
— | — | 56 | 8 | 24 | ||||||||||||||||||
Education support
|
— | — | — | — | 5 | ||||||||||||||||||
Alternative payments for standing programs
|
-2,662 | –2,460 | –2,425 | –2,150 | –2,108 | ||||||||||||||||||
Other transfer payments
|
19,854 | 23,503 | 18,535 | 18,735 | 22,476 | ||||||||||||||||||
Total transfer payments
|
85,583 | 82,927 | 76,489 | 78,923 | 77,047 | ||||||||||||||||||
Crown corporations expenditures
|
4,082 | 2,903 | 2,953 | 3,497 | 2,548 | ||||||||||||||||||
Other program expenditures
|
|||||||||||||||||||||||
Defence
|
10,571 | 9,696 | 10,201 | 8,781 | 8,879 | ||||||||||||||||||
All other departments and agencies
|
26,437 | 23,822 | 22,120 | 20,192 | 20,279 | ||||||||||||||||||
Total other program expenditures
|
37,008 | 33,518 | 32,321 | 28,973 | 29,158 | ||||||||||||||||||
Total program expenditures
|
126,673 | 119,348 | 111,763 | 111,393 | 108,753 | ||||||||||||||||||
PUBLIC DEBT CHARGES
|
37,735 | 42,094 | 41,647 | 41,394 | 40,931 | ||||||||||||||||||
TOTAL BUDGETARY EXPENDITURES
|
$ | 164,408 | $ | 161,442 | $ | 153,410 | $ | 152,787 | $ | 149,684 | |||||||||||||
Source: Public Accounts of Canada 2002.
22
Table of Contents
Loans, Investments and
Advances
Loans, investments and advances by the Government
resulted in a net requirement of funds of $96 million in
fiscal 2001-02.
Pension and Other Accounts
The Government acts as an insurer and/or
administrator of a number of pension funds and annuities and
deposit and trust accounts. The excess of receipts over
disbursements in these accounts has provided the Government with
an important source of financing. The balance outstanding
of these accounts amounted to $141.2 billion at
March 31, 2002. The public sector pensions comprised
90% of the outstanding balance at March 31, 2002.
Canada Pension Plan.
The Canada Pension Plan (the “Plan”) is
a federal-provincial program for compulsory and
contributory social insurance. It operates in all parts of
Canada, except for Quebec which has a comparable program.
The Government administers the Plan under joint control
with the participating provinces. Until 1997, the Plan was
financed on an essentially pay-as-you-go basis, which means that
pensions and benefits were paid out of current contributions
(with some interest earned by the Canada Pension Plan
Investment Fund). In December 1997, the Government
passed legislation to ensure that the Plan remains sustainable
over the long term and to allow fuller funding. Changes included
a more rapid increase in contribution rates, a new
investment policy, as well as changes to calculations of,
and eligibility criteria to, some benefits. Under the new
investment policy which came into effect April 1, 1998, the
Plan’s funds are prudently invested by an independent
investment board in a diversified portfolio of securities,
including equities, under generally the same rules that apply to
other private and public pension funds.
Contributions are paid equally by employers and
employees and self-employed workers pay the full amount.
In 2002 the combined contribution rate is 9.4%.
As a result of changes legislated in 1997,
it will rise to 9.9% in 2003 and then remain constant at
that level. As administrator, the Government’s
authority to spend is limited to the Plan’s net assets of
$51.9 billion at March 31, 2002 ($45.7 billion at
March 31, 2001). Of these assets, $28.3 billion
was invested in securities issued or guaranteed by the provinces
and Canada, $14.4 billion was transferred to the Canada
Pension Plan Investment Board and $6.8 billion was
a direct liability of the Government.
Public Sector Pensions.
The Government is responsible for
defined benefit pension plans covering substantially all of its
full-time employees (including the Public Service, Canadian
Forces, Royal Canadian Mounted Police and certain Crown
corporations) as well as federally appointed judges and Members
of Parliament. Pension benefits are generally calculated by
reference to highest earnings for a specific period of
time. They are related to years of service and are indexed to
inflation. Until March 31, 2000, separate market invested
funds were not set aside to provide for payment of these pension
benefits. Beginning on April 1, 2000, new employer and
employee contributions to the pension plans are transferred to
the Public Sector Pension Investment Board. Its goal is to
achieve maximum rates of return on investments without undue
risk, while respecting the requirements and financial
obligations of each of the public sector pension plans.
At March 31, 2002 the net liability in respect of
these accounts totalled $126.9 billion. This net
liability is comprised of the accrued benefit obligation
determined as of March 31, 2001, which amounted to
$125.9 billion, less pension plan assets of
$3.2 billion and unamortized pension adjustments of
$8.3 billion. In fiscal 2001-02 the net liability to
the public sector pensions decreased by $2.3 billion,
mainly due to the transfer of assets to the new Crown
pension plans.
23
Table of Contents
Other Transactions
This category includes accounts payable, interest
accrued on federal debt, cheques issued but outstanding and
other miscellaneous accounts. These transactions, due to their
nature, are subject to wide fluctuations. They were a
requirement of $4.2 billion in fiscal 2001-02.
DETAILED STATEMENT OF TRANSACTIONS —
NON-BUDGETARY TRANSACTIONS
| For the years ended March 31, | |||||||||||||||||||||||
| 2002 | 2000 | 1999 | 1998 | 1997 | |||||||||||||||||||
| (in millions) | |||||||||||||||||||||||
LOANS, INVESTMENTS AND ADVANCES
|
|||||||||||||||||||||||
Crown corporations —
|
|||||||||||||||||||||||
Lending institutions —
|
|||||||||||||||||||||||
Canada Deposit Insurance Corporation
|
$ | — | $ | — | $ | — | $ | 395 | $ | 460 | |||||||||||||
Canada Mortgage and Housing Corporation
|
226 | 224 | 223 | 410 | 230 | ||||||||||||||||||
Farm Credit Corporation
|
578 | 226 | 236 | 836 | 580 | ||||||||||||||||||
Business Development Bank of Canada
|
— | –65 | –108 | –50 | — | ||||||||||||||||||
| 804 | 385 | 351 | 1,591 | 1,270 | |||||||||||||||||||
All other Crown corporations —
|
|||||||||||||||||||||||
Other
|
89 | 92 | 139 | –43 | –29 | ||||||||||||||||||
| 89 | 92 | 139 | –43 | –29 | |||||||||||||||||||
Total Crown corporations
|
893 | 477 | 490 | 1,548 | 1,241 | ||||||||||||||||||
Other loans, investments and advances —
|
|||||||||||||||||||||||
Provincial and territorial governments
|
386 | -963 | -553 | -60 | -255 | ||||||||||||||||||
National governments including developing
countries
|
234 | 2 | 198 | –476 | 215 | ||||||||||||||||||
International organizations
|
-35 | –228 | 41 | –209 | 1,607 | ||||||||||||||||||
Portfolio investments
|
— | — | — | — | 59 | ||||||||||||||||||
Other
|
-1,466 | –1,239 | 343 | –754 | –118 | ||||||||||||||||||
Total other loans, investments and advances
|
-881 | –2,248 | 29 | –1,499 | 1,508 | ||||||||||||||||||
Allowance for valuation of assets
|
-108 | –747 | –1,136 | 281 | –1,144 | ||||||||||||||||||
Total loans, investments and advances
|
-96 | –2,698 | –617 | 330 | 1,605 | ||||||||||||||||||
PENSION AND OTHER ACCOUNTS
|
|||||||||||||||||||||||
Canada Pension Plan Account (net)
|
379 | 174 | 791 | 1,222 | 487 | ||||||||||||||||||
Public sector pensions (net)
|
-2,264 | 839 | 5,938 | 4,950 | 3,252 | ||||||||||||||||||
Other
|
216 | 290 | 239 | 852 | 90 | ||||||||||||||||||
Total pension and other accounts
|
-1,669 | 1,303 | 6,968 | 7,024 | 3,829 | ||||||||||||||||||
OTHER TRANSACTIONS
|
|||||||||||||||||||||||
Accounts receivable
|
-396 | 213 | 162 | –516 | 381 | ||||||||||||||||||
Outstanding cheques and warrants
|
1,240 | 699 | –144 | 827 | –35 | ||||||||||||||||||
Cash in transit
|
-324 | –1,570 | 46 | –902 | –468 | ||||||||||||||||||
Provincial tax collection agreements account
|
-1,139 | –824 | –1,402 | 1,267 | –551 | ||||||||||||||||||
Other liabilities
|
-1,826 | 3,720 | –3,167 | 349 | 4,151 | ||||||||||||||||||
Total other transactions
|
-2,445 | 2,238 | –4,505 | 1,045 | 3,388 | ||||||||||||||||||
NET NON-BUDGETARY TRANSACTIONS
|
$ | -4,210 | $ | 843 | $ | 1,853 | $ | 8,379 | $ | 8,912 | |||||||||||||
Source: Public Accounts of
Canada 2002.
Foreign Exchange Transactions
Foreign exchange transactions represent all
transactions in international reserves held in the Exchange Fund
Account (EFA). The objectives of the EFA are to provide general
foreign currency liquidity for the Government and promote
orderly conditions in the foreign exchange market. The EFA
contains foreign currency investments, gold holdings and assets
related to Canada’s commitment to the International
Monetary Fund.
24
Table of Contents
Unmatured Debt
The Government’s unmatured debt represents
financial obligations resulting from the sale of marketable
bonds, treasury bills, Canada Savings Bonds, Canada Premium
Bonds, Canada Bills, and Canada Notes, as well as from
non-marketable obligations issued to the Canada Pension Plan
Investment Fund.
Borrowing is one of the two major sources of
money available to the Government to finance its operations. The
increase in unmatured debt payable in Canadian currency has been
broadly consistent with changes in financial requirements.
The changes in unmatured debt payable in foreign currency
have been associated with developments in foreign exchange
markets and related requirements to supplement foreign exchange
reserves through foreign borrowing.
UNMATURED DEBT
(Principal Amount Outstanding)
| At March 31, | ||||||||||||||||||||||||||
| At | ||||||||||||||||||||||||||
| Sept. 30, | ||||||||||||||||||||||||||
| 2002 | 2002 | 2001 | 2000 | 1999 | 1998 | |||||||||||||||||||||
| (in millions) | ||||||||||||||||||||||||||
CANADIAN CURRENCY
|
||||||||||||||||||||||||||
Marketable bonds
|
284,981 | 292,910 | 293,879 | $ | 293,250 | $ | 294,914 | $ | 293,987 | |||||||||||||||||
Treasury bills
|
102,200 | 94,200 | 88,700 | 99,850 | 96,950 | 112,300 | ||||||||||||||||||||
Canada Savings Bonds
|
18,354 | 18,928 | 21,410 | 23,876 | 25,791 | 30,144 | ||||||||||||||||||||
Canada Premium Bonds
|
5,129 | 5,092 | 4,204 | 3,023 | 2,427 | 61 | ||||||||||||||||||||
Obligations issued to Canada Pension Plan
Investment Fund
|
3,374 | 3,386 | 3,403 | 3,427 | 4,063 | 3,456 | ||||||||||||||||||||
Total Canadian currency
|
414,038 | 414,516 | 411,596 | 423,426 | 424,145 | 439,948 | ||||||||||||||||||||
FOREIGN CURRENCY (1)
|
||||||||||||||||||||||||||
Canada Bills
|
2,947 | 3,355 | 7,228 | 6,008 | 10,171 | 9,354 | ||||||||||||||||||||
Canada Notes
|
1,300 | 1,202 | 1,580 | 1,053 | 1,253 | 1,665 | ||||||||||||||||||||
Euro Medium Term Note Program
|
3,273 | 2,933 | 3,417 | 4,038 | 4,884 | 1,502 | ||||||||||||||||||||
Other marketable bonds (2)
|
18,358 | 19,629 | 20,488 | 21,317 | 19,581 | 14,590 | ||||||||||||||||||||
Standby credit facilities
|
— | — | — | — | — | — | ||||||||||||||||||||
Total foreign currency
|
25,878 | 27,119 | 32,713 | 32,416 | 35,889 | 27,111 | ||||||||||||||||||||
TOTAL UNMATURED DEBT
|
$ | 439,916 | $ | $441,635 | $ | 444,309 | $ | 455,842 | $ | 460,034 | $ | 467,059 | ||||||||||||||
Source: Bank of Canada.
(1) Foreign currency debt is converted to
Canadian dollars using the following closing exchange rate
levels:
| At | At March 31, | |||||||||||||||||||||||
| Sept. 30, | ||||||||||||||||||||||||
| 2002 | 2002 | 2001 | 2000 | 1999 | 1998 | |||||||||||||||||||
| (in millions) | ||||||||||||||||||||||||
United States Dollar
|
1.5872 | 1.5942 | 1.5763 | 1.4494 | 1.5087 | 1.4195 | ||||||||||||||||||
British Pound
|
2.4894 | 2.2716 | 2.2315 | 2.3089 | 2.4366 | 2.3752 | ||||||||||||||||||
Danish Krone
|
0.2111 | 0.1868 | 0.1852 | 0.1861 | 0.2193 | 0.2016 | ||||||||||||||||||
Japanese Yen
|
0.01300 | 0.01202 | 0.01249 | 0.0141 | 0.01275 | 0.01066 | ||||||||||||||||||
New Zealand Dollar
|
0.7450 | 0.7026 | 0.6370 | 0.7211 | 0.8073 | 0.7837 | ||||||||||||||||||
Euro
|
1.5675 | 1.3879 | 1.3837 | 1.3263 | 1.6313 | — | ||||||||||||||||||
Greek Drachma
|
— | — | 0.004070 | 0.004160 | 0.004991 | — | ||||||||||||||||||
Hong Kong Dollar
|
— | — | 0.202254 | 0.186669 | 0.1947 | — | ||||||||||||||||||
Norwegian Krone
|
0.2146 | 0.1801 | 0.1718 | 0.1713 | 0.1954 | — | ||||||||||||||||||
| (2) | Excludes Canada Notes and Euro Medium Term Notes. Other foreign currency marketable bonds are comprised of the following amounts (before conversion to Canadian dollars): |
| At | At March 31, | |||||||||||||||||||||||
| Sept. 30, | ||||||||||||||||||||||||
| 2002 | 2002 | 2001 | 2000 | 1999 | 1998 | |||||||||||||||||||
| (in millions) | ||||||||||||||||||||||||
United States Dollars
|
9.312 | 10,312 | 11,000 | 12,500 | 10,500 | 10,000 | ||||||||||||||||||
New Zealand Dollars
|
500 | 500 | 500 | 500 | 500 | 500 | ||||||||||||||||||
Euro
|
2,045 | 2,045 | 2,045 | 2,045 | 2,045 | — | ||||||||||||||||||
25
Table of Contents
Marketable bonds are interest-bearing obligations
available to all investors generally. In the period
April 1, 2002 to September 30, 2002 the Government
issued an aggregate of $20,300 million of marketable bonds
in Canadian currency and redeemed $28,928 million
(including $10,486 million in repurchased and cancelled
bonds), for a net decrease of $8,628 million. Treasury
bills are obligations issued at a discount with maturities
generally of three months, six months and
one year. In the period April 1, 2002 to
September 30, 2002 the amount of treasury bills outstanding
increased by $8,000 million. Canada Savings Bonds are
offered to individual Canadian residents and differ from other
bonds in that they can be redeemed prior to maturity at the
option of the holder for the full face value, plus accrued
interest. In the period April 1, 2002 to
September 30, 2002 the amount of unmatured Canada Savings
Bonds outstanding decreased by $574 million.
The Canada Premium Bond is a new retail investment and
savings product introduced in 1998 and replaces the Canada
Registered Retirement Savings Plan Bond (“Canada
RRSP Bond”). It offers a higher interest rate
compared to Canada Savings Bonds and is redeemable once a year,
on the anniversary of the issue date and during the 30 days
thereafter without penalty. In the period April 1, 2002 to
September 30, 2002 the amount of unmatured Canada Premium
Bonds outstanding increased by $37 million. Obligations
issued to Canada Pension Plan Investment Fund are
non-marketable. Canada Bills are short-term
U.S. dollar-denominated unsecured obligations issued in the
U.S. money market with a term to maturity of not more than
270 days. Canada Notes are usually
U.S. dollar-denominated interest-bearing marketable notes
that mature not less than nine months from their date of
issue. The Euro Medium-Term Notes are medium-term notes issued
outside the United States and Canada. Notes issued under
this program can be denominated in a range of currencies and
structured to meet investor demand. The other marketable bonds
are comprised of 8 global bond issues and 5 Petro
Canada bond issues assumed by the Government of Canada on
February 5, 2001, on the dissolution of Petro Canada
Limited in U.S. dollars and other foreign currencies.
As part of the Government’s domestic
interest rate swap program, outstanding fixed-rate Canadian
dollar marketable bonds were converted into floating-rate
Canadian dollar liabilities and as of September 30, 2002
$50 million remained outstanding. In the mid
1990’s, Canada implemented an Exchange Fund Account foreign
currency swap program. Under these foreign exchange swaps,
Canadian dollar liabilities are swapped into liabilities in
foreign currencies, allowing Canada to raise foreign exchange
reserves cost effectively. As of September 30, 2002,
$13,681 million of Canadian dollars have been swapped for
U.S.$9,205 million, $13,033 million of Canadian
dollars have been swapped for Euro 9,206 million and
$111 million Canadian dollars have been swapped for
¥8 billion.
The average rates of interest paid on the
unmatured debt outstanding by instrument are set out below.
AVERAGE RATES OF INTEREST
| At March 31, | ||||||||||||||||||||
| 2002 | 2001 | 2000 | 1999 | 1998 | ||||||||||||||||
Marketable bonds (1)
|
6.61 | % | 6.98 | % | 7.21 | % | 7.51 | % | 7.75 | % | ||||||||||
Treasury bills
|
2.64 | 5.31 | 5.31 | 4.94 | 4.41 | |||||||||||||||
Canada Savings Bonds
|
3.23 | 5.42 | 5.13 | 4.28 | 3.61 | |||||||||||||||
Non-marketable bonds and notes (2)
|
10.16 | 10.10 | 10.04 | 9.39 | 10.22 | |||||||||||||||
Canada Bills
|
1.75 | 5.10 | 5.87 | 4.81 | 5.49 | |||||||||||||||
Foreign currency notes
|
2.46 | 4.15 | 4.95 | 4.70 | 5.87 | |||||||||||||||
Total Unmatured Debt
|
5.56 | 6.11 | 6.15 | 6.70 | 6.64 | |||||||||||||||
Source: Public Accounts of Canada 2002.
(1) Excludes Canada Notes and Euro Medium-Term
Notes, but includes other foreign currency marketable bonds.
(2) Includes the bonds for the Canada Pension
Plan and the notes for the Canada Health and Social Transfer
Supplement.
26
Table of Contents
The following table shows the scheduled
repayments in respect of principal and interest on the
marketable bonds and notes outstanding at September 30,
2002.
SCHEDULE OF MARKETABLE DEBT REPAYMENTS
(in millions)
| Total Principal and Interest | ||||||||
| Foreign | ||||||||
| Canadian | Currency | |||||||
| For years ended | Currency | Debt | ||||||
| December 31, | Debt(1) | (1)(2)(3)(4) | ||||||
2002
|
12,072 | 210 | ||||||
2003
|
57,601 | 4,194 | ||||||
2004
|
57,111 | 2,332 | ||||||
2005
|
33,259 | 3,120 | ||||||
2006
|
30,874 | 2,022 | ||||||
2007-2011
|
114,334 | 10,878 | ||||||
2012-2016
|
39,789 | — | ||||||
2017-2021
|
33,458 | — | ||||||
2022-2026
|
39,173 | — | ||||||
2027-2031
|
33,957 | — | ||||||
2032-2036
|
13,082 | — | ||||||
Source: Bank of Canada.
(1) Excludes the effect of interest rate swaps
and cross currency swaps.
(2) Includes Canada Notes and other foreign
currency marketable bonds and notes.
(3) Converted at U.S. $1.00 = $1.5872,
Japanese Yen 1.00 = $0.01300, British Pound
1.00 = $2.4894, Danish Krone 1.00 = $0.2111,
New Zealand $1.00 = $0.7450, Norwegian Krone
1.00 = $0.2146 and Euro 1.00 = $1.5675, the
closing rates on September 30, 2002.
(4) Excludes principal and interest payments on
U.S. $312,114,000 of Petro Canada bond issues assumed by
the Government of Canada on February 5, 2001, on the
dissolution of Petro Canada Limited.
Crown Corporations
Except for enterprise Crown corporations, which
are accounted for by the cost method, all Government
organizations are accounted for in the financial statements by
consolidation. Only certain financial transactions between the
Government and enterprise Crown corporations are recorded. All
assets and liabilities of agent Crown corporations are, however,
assets and liabilities of the Government.
The payment of all money borrowed by agent Crown
corporations is a charge on and payable out of the Consolidated
Revenue Fund. Such borrowings constitute unconditional
obligations of the Government and are recorded as such in the
accounts of Canada, net of borrowings expected to be repaid
directly by these corporations. Borrowings to be repaid by agent
enterprise Crown corporations amounted to $44,361 million
as at March 31, 2002. The following table summarizes
the unaudited financial information of consolidated and
enterprise Crown corporations as at March 31, 2002.
FINANCIAL INFORMATION REGARDING CROWN CORPORATIONS
(in millions)
| Consolidated | Enterprise | Total | |||||||||||||
Assets
|
|||||||||||||||
Total assets
|
$ | 4,929 | $ | 120,981 | $ | 125,910 | |||||||||
Liabilities
|
|||||||||||||||
Liabilities to other than Government
|
|||||||||||||||
Borrowings
|
— | 53,103 | 53,103 | ||||||||||||
Other
|
1,799 | 50,424 | 52,223 | ||||||||||||
| 1,799 | 103,527 | 105,326 | |||||||||||||
Net assets
|
$ | 3,130 | $ | 17,454 | $ | 20,584 | |||||||||
Financial interest of the Government
|
|||||||||||||||
Obligations to the Government
|
$ | 1,809 | $ | 9,386 | $ | 11,195 | |||||||||
Net equity of the Government
|
1,322 | 8,068 | 9,390 | ||||||||||||
Total financial interest
|
$ | 3,131 | $ | 17,454 | $ | 20,585 | |||||||||
Contingent liabilities
|
$ | 56 | $ | 2,651 | $ | 2,707 | |||||||||
Source: Public Accounts of Canada 2002.
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Contingent Liabilities (with Respect to
Guarantees by the Government)
The contingent liabilities of the Government,
with respect to guarantees by the Government as at
March 31, 2002 are summarized as follows.
CONTINGENT LIABILITIES (WITH RESPECT TO NET
EXPOSURE UNDER GUARANTEES)
(in millions)
Guarantees by the Government of
|
||||||
Borrowings by enterprise Crown corporations which
are agents of Her Majesty
|
$ | 45,175 | ||||
Borrowings by other than Crown corporations
|
||||||
From agents
|
370 | |||||
From other than agents
|
3,660 | |||||
Other explicit loan guarantees
|
465 | |||||
Insurance programs of the Government
|
2,757 | |||||
Other explicit guarantees
|
557 | |||||
Total gross guarantees
|
60,914 | |||||
Less: allowance for losses
|
-4,076 | |||||
Net exposure under guarantees
|
$ | 56,838 | ||||
Source: Public Accounts of Canada 2002.
Insurance Programs
Certain agent Crown corporations operate
insurance programs. In the event that such corporations have
insufficient funds to meet their obligations, the Government
would provide the required financing through appropriations,
either budgetary or non-budgetary.
The following table summarizes the unaudited
information regarding such insurance programs as at
March 31, 2002.
AGENT CROWN CORPORATIONS INSURANCE PROGRAMS
| 5 year | Closing | ||||||||||||||||
| average | balance | ||||||||||||||||
| Insurance | Net | of net | of | ||||||||||||||
| in force | claims (1) | claims | fund | ||||||||||||||
| (in millions) | |||||||||||||||||
Canada Deposit Insurance Corporation
|
$ | 346,809 | $ | 18 | $ | — | $ | 486 | |||||||||
Canada Mortgage and Housing Corporation
|
|||||||||||||||||
Mortgage Insurance Fund
|
218,900 | 229 | 291 | 1,229 | |||||||||||||
Mortgage-Backed Securities Guarantee Fund
|
37,452 | — | — | 80 | |||||||||||||
Export Development Canada
|
|||||||||||||||||
Export insurance contracts entered into on its
own behalf
|
12,292 | 21 | 70 | 457 | |||||||||||||
Source: Public Accounts of Canada 2002.
(1) Refers to the difference between claims and
amounts received from sales of related assets and other
recoveries.
DEBT RECORD
Canada has always paid the full face amount of
the principal and interest on every direct obligation issued by
it and every indirect obligation on which it has been required
to implement its guarantee, promptly when due. During war, where
such payment would have violated laws or regulations forbidding
trading with the enemy, payment was made to a custodian of enemy
property.
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MONETARY AND BANKING SYSTEM
Bank of Canada
The Bank of Canada (the “Bank”) was
incorporated in 1934 under the Bank of Canada Act (in
this sec-tion referred to as the ”Act”) as
Canada’s central bank. All of the capital stock of the Bank
is owned by the Government. The Act gives the Bank the
responsibility for the conduct of monetary policy and confers
specific powers for discharging that responsibility.
The Bank has the sole right to issue paper money
for circulation in Canada. The Bank acts as the fiscal agent for
the Government. As fiscal agent, the Bank is responsible for
handling new borrowings, administering the outstanding debt, and
making payments on behalf of the Government for interest and
debt redemption. As well, the Bank advises the Government on
matters relating to managing the public debt. The Bank may buy
or sell various types of securities, including securities issued
or guaranteed by Canada or any province, short-term securities
issued by the United Kingdom, and treasury bills or other
obligations of the United States. The Bank may buy and sell
foreign currencies, SDRs issued by the IMF, coin, and gold and
silver bullion. The Bank may open accounts with other central
banks and at the Bank for International Settlements
(“BIS”) as well as maintain accounts in commercial
banks to facilitate the buying and selling of foreign
currencies. The Bank may accept deposits from the Government or
any of its corporations or agencies, any province, any chartered
bank or any member of the Canadian Payments Association. The
Bank may pay interest to the Government on any deposits made to
the Bank and may pay interest to member institutions of the
Canadian Payments Association on deposits accepted for certain
specified purposes. It may also accept deposits from other
central banks and official international financial organizations
and may pay interest on such deposits. The Bank does not accept
deposits from individuals nor does it compete with the chartered
banks in the commercial banking field. The Bank is not required
to maintain gold or foreign exchange reserves against its
liabilities.
The Bank may, on the pledge of certain classes of
securities or property, make loans or advances for periods not
exceeding six months to chartered banks, and to any other
members of the Canadian Payments Association that maintain
deposits with the Bank. The Bank Rate is the minimum rate at
which the Bank is prepared to make loans or advances. Although
the Bank has the power to make loans or advances under certain
conditions and for limited periods to the Government or any
province, such loans are extremely rare and no such loans have
been made in over 35 years.
The framework for the implementation of monetary
policy by the Bank was changed considerably on two occasions
during the past ten years, first as a result of the phased
elimination of reserve requirements between June 1992 and
July 1994, and second, with the introduction of a real-time
large-value settlement system (the “Large Value Transfer
System” or “LVTS”) in February 1999.
The central mechanisms through which the Bank
currently implements monetary policy are the LVTS and a
50-basis-point operating band for the overnight interest rate
adopted by the Bank in mid 1994. Currently, the Bank sets
the level of excess settlement balances in the LVTS at a minimum
of $50 million. Any participant in the LVTS with
a deficit funds position should therefore be aware that
there will be one or more participants with offsetting surplus
positions that are potential counterparties for transactions at
market rates. The Bank encourages these transactions by paying
an interest rate on positive balances held overnight by LVTS
participants at the lower limit of its operating band and
charging an interest rate on overdraft loans to LVTS
participants at the upper limit of the band (which is also the
Bank Rate). Thus the overnight rate will typically stay within
the operating band since participants are aware that they can
earn at least the lower limit of the band on positive balances
and need not pay more than the upper limit to cover shortfalls.
Moreover, the Bank is prepared to enter into overnight buyback
transactions at the midpoint of the operating band to reinforce
its target rate. Through its influence on the interest rate for
overnight funds, the Bank is able to influence other short-term
interest rates, the exchange rate, aggregate demand and,
ultimately, inflation.
The Bank controls the level of settlement
balances available to financial institutions by adjusting the
level of Government deposits held at the financial institutions
which settle through the Bank. Prior to the
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introduction of LVTS, this adjustment was done by
means of a daily transfer of Government demand deposits
between the Government’s accounts at the Bank and at the
financial institutions. Since LVTS, this adjustment has been
accomplished through twice-daily auctions of Government term
deposits.
The Act provides for regular consultation between
the Governor of the Bank and the Minister of Finance as well as
for a formal procedure whereby, in the event of a disagreement
between the Government and the Bank which cannot be
resolved, the Government may issue a directive to the Bank as to
the monetary policy that it is to follow. The directive must be
in writing, in specific terms, applicable for a specified period
and published forthwith. This provision in the Act makes it
clear that the Government must take the ultimate responsibility
for monetary policy, but the Bank is in no way relieved of its
responsibility for monetary policy and its execution so long as
a directive is not in effect. No directive has ever been issued.
The Payment Clearing and Settlement Act, 1996
gives the Bank formal responsibility for the regulatory
oversight of major clearing and settlement systems.
Specifically, the Bank will review all eligible systems and
identify their potential to cause systemic risk. Systems with
this potential are subject to designation under the Payment
Clearing and Settlement Act, 1996. Designated systems will
have to satisfy the Bank that they have appropriate
risk-control mechanisms in place. The Bank may carry out
examinations and, in situations where it is judged that systemic
risk is being inadequately controlled, the Governor of
the Bank may issue directives to a designated system.
The Payment Clearing and Settlement Act, 1996
also gives the Bank new powers to provide certain
services. In particular, the Bank can provide a guarantee of
settlement to the participants of designated systems.
Other Government Financial
Institutions
Export Development Canada (“EDC”) was
established on October 1, 1969 for the purpose of facilitating
and developing trade between Canada and other countries. EDC is
the successor to the Export Credits Insurance Corporation which
commenced operations in 1944. Activities were originally limited
to insuring Canadian exporters against nonpayments of credits
extended to foreign buyers. To further enhance Canada’s
growing export trade, EDC has introduced an export loans
program, a foreign investment guarantees program and a surety
risk protection insurance program. The Federal Business
Development Bank was established in 1975 as the successor to the
Industrial Development Bank which was established in 1944 as a
subsidiary of the Bank of Canada. In 1995, the Federal Business
Development Bank was continued as the Business Development Bank
of Canada (“BDC”). The purpose of the BDC is to
provide financial and management services to small and
medium-sized businesses in Canada. The Canada Deposit Insurance
Corporation, established in 1967, insures deposits payable in
Canada and in Canadian currency at banks and other financial
institutions up to $60,000 per depositor. Farm Credit Canada was
established in 1959 to provide for the extension of long-term
mortgage credit to farmers. The Canada Mortgage and Housing
Corporation (formerly the Central Mortgage and Housing
Corporation) was incorporated in 1945 to insure mortgage loans
made by approved lenders and to make direct mortgage loans.
Chartered Banks
Canada’s banks are all federally
incorporated and are regulated under the Bank Act.
The Bank Act sets out the rules for the structure
and operation of these institutions. It is the current practice
in Canada to revise the Bank Act after intervals of
approximately five years with the most recent revision taking
place in 2001 (see Financial Sector Restructuring below).
The Office of the Superintendent of Financial Institutions is
the federal agency responsible for supervising banks.
Under the Bank Act, foreign banks are
permitted to incorporate subsidiaries by letters patent. In
June 1999, legislation was passed to allow foreign banks to
establish specialized, commercially focused branches in Canada.
Foreign banks can operate full service branches and lending
branches. In November
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2002, the banking system consisted of
15 domestic banks, 33 foreign bank subsidiaries,
17 full-service foreign bank branches and 3 foreign
bank lending branches.
Financial Sector
Restructuring
On June 14, 2001, Royal Assent was given to
Bill C-8, An Act to establish the Financial Consumer
Agency of Canada and to amend certain Acts in relation to
financial institutions. Bill C-8, which amended various
federal financial sector statutes, reformed Canada’s
financial services sector, which includes domestic and foreign
banks, trust companies, insurance companies, credit unions and
other financial institutions.
Some of the key elements contained in
Bill C-8, as well as the measures being implemented by
non-legislative means such as guidelines and statements of
government policy that compliment the legislation, include: a
new definition of widely held ownership for federal financial
institutions that allows for strategic alliances and joint
ventures with significant share exchanges; a new holding company
regime which offers financial institutions the potential for
greater structural flexibility; a bank merger review process
with a formal mechanism for public input; broader access to the
payments system to accommodate the entry of life insurance
companies, securities dealers and money market mutual funds that
meet certain criteria, including regulatory oversight and
liquidity; and the creation of the Financial Consumer Agency of
Canada to enforce the consumer-related provisions of the federal
financial institution statutes.
Monetary Policy and Interest Rate
Developments
The ultimate objective of Canadian monetary
policy is to promote good overall economic performance through
price stability.
In February 1991, the Government and the Bank of
Canada (the “Bank”) jointly announced a series of
targets for reducing total CPI inflation to the mid-point of a
range of 1% to 3% by the end of 1995. This inflation-control
target range has been extended a number of times. In
May 2001 the 1% to 3% target range was extended to the end
of 2006. Monetary policy will continue to aim at keeping future
inflation at the 2% target mid-point of this range, both to
maximize the likelihood that inflation stays within the target
range and to increase the predictability of inflation over the
longer term.
The policy instrument the Bank uses to influence
monetary conditions is the overnight rate target, which is the
mid-point of the Bank’s operating band for overnight
financing. The Bank constantly reassesses the level of the
overnight rate target necessary to achieve the inflation-control
targets.
Since the Fall of 2000, the Bank has moved to
fixed announcement dates for the overnight rate target to make
monetary policy more effective. Fixed dates have reduced the
uncertainty in financial markets associated with not knowing
exactly when changes in the overnight rate target may be
announced, and contributed to the improved functioning of
financial markets. Fixed dates have provided a regular
opportunity to emphasize the medium-term perspective of monetary
policy and increased the Bank’s transparency,
accountability and dialogue with the public.
On January 15 of 2002, the Bank of Canada
lowered its target for the overnight interest rate by 25 basis
points to 2.00%. This was the last in a series of 10 cuts
the Bank made since January 2001. These reductions were aimed at
keeping inflation close to the mid-point of the
inflation-control target range over the medium term, and were
implemented in the context of a slowdown in both external and
domestic aggregate demand.
Up until August 2002, the Bank had increased
its target interest rate by 25 basis points on
3 consecutive occasions, bringing the rate to 2.75%. These
increases were in response to the strength of Canada’s
economic recovery which began in the last quarter of 2001 and
has continued in the first half of 2002.
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The Bank announced no change in the target rate
at its September 4 and October 16 fixed announcement
dates, citing the weakening near-term prospects for growth in
the United States, increased uncertainty associated with
volatility in the global financial markets and the unsettled
geopolitical situation as reasons for the pause in rate hikes.
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Membership in International Economic
Organizations
As of December 31, 2001, Canada’s
paid-up quota in the IMF is currently SDR 6,369.2 million.
On December 31, 2001 one SDR equalled Cdn $2.00147.
Canada also participates in the General
Arrangements to Borrow (the ”GAB”) and the New
Arrangements to Borrow (the “NAB”) which provide
special financial resources to the IMF. Canada’s total
commitment under the GAB and the NAB amount to SDR 1,396.0
million. As of December 31, 2001 there were no loans
outstanding to the IMF under the GAB and the NAB.
Canada is also a member of the Organization for
Economic Cooperation and Development, a party to the World Trade
Organization and a shareholder (through the Bank of Canada) of
the BIS. Canada’s participation in other international
development institutions is summarized in the table below.
PARTICIPATION IN OTHER INTERNATIONAL DEVELOPMENT
INSTITUTIONS
| At December 31, 2001 | ||||||||||||
| Subscription | Cumulative Contributions | |||||||||||
| to Special | ||||||||||||
| Total | Paid-in(1) | Development Funds(2) | ||||||||||
| (in millions of | ||||||||||||
| (in millions of | U.S. dollars | |||||||||||
| U.S. dollars) | unless otherwise | |||||||||||
| indicated) | ||||||||||||
International Bank for Reconstruction
and Development
|
$ | 5,403.8 | $ | 334.9 | — | |||||||
International Development Association
(“IDA”)
|
— | — | C$5,761.8 | |||||||||
International Finance Corporation
|
81.3 | 81.3 | — | |||||||||
Multilateral Investment Guarantee Agency
|
56.5 | 10.7 | — | |||||||||
Asian Development Bank
|
2,324.0 | 162.7 | 1,042.5 | |||||||||
Inter-American Development Bank
|
4,039.8 | 173.7 | 289.6 | |||||||||
Caribbean Development Bank
|
62.7 | 13.7 | 101.8 | |||||||||
African Development Bank
|
1,011.4 | 88.0 | 1,167.6 | |||||||||
European Bank for Reconstruction and Development
|
828.6 | 149.0 | — | |||||||||
Source: Department of Finance; Annual Reports of
Regional Development Banks
(1) Balance of subscription payable only in the
unlikely event that there is a call on the institution’s
capital.
(2) Special Development Funds provide loans to
the poorest countries on highly concessional terms. Cumulative
contributions reflect encashments of existing notes. Canada also
has additional future obligations for notes that have been
issued and not yet encashed. Payments to concessional funds have
been converted from Canadian into U.S. dollars and
therefore reflect end-of-year exchange rates.
33
Exhibit E
CONSENT
I hereby consent to the use of my name in the
Canada description attached as Exhibit D to the
Form 18-K of Canada. I acknowledge that such description
may from time to time be incorporated by reference into one or
more Registration Statements, and in the related prospectuses,
of Canada and/or one or more Crown Corporations of Canada. I
consent to the use of my name in any such Registration
Statements and related prospectuses in connection with the
information so incorporated.
| /s/ Kevin G. Lynch | ||
| Kevin G. Lynch | ||
| Deputy Minister of Finance |
Ottawa, Canada
December 20, 2002
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