Canada's Balance of International Payments

Detailed information for first quarter 2024

The balance of international payments covers all economic transactions between Canadian residents and non-residents in three accounts: the current account, the capital account and the financial account.

• Questionnaire(s) and reporting guide(s)
• Description
• Data sources and methodology

Description

This statistical program records economic transactions between Canadian residents and non-residents, allocated between the current account, the capital account and the financial account. The transactions recorded in the balance of payments statement represent the exchanges and transfers of economic values between Canadian residents and non-residents viewed from a Canadian perspective. The economic values exchanged or transferred can be goods, services, primary and secondary income or financial claims. The transactions are presented using a double entry accounting system in which two entries should be recorded simultaneously for each transaction. The two entries are used to recognize the giving and receiving sides of every transaction. Imports and income payable are recorded as debit entries while exports and income receivable are recorded as credit entries. Correspondingly, a capital outflow in the financial account refers to a net acquisition of Canadian assets abroad or a decrease in Canadian liabilities to non-residents. A capital inflow is associated to a disposal of Canadian assets abroad or an increase in Canadian liabilities to non-residents.

Government relies on these statistics to help shape its financial and trade policies. Balance of payments statistics are also used extensively by businesses, the academic community, the media and the public at large for both informational and analytical purposes. Finally, they are needed to meet Canada's statistical obligations to supranational organizations, such as the International Monetary Fund and the Organization for Economic Co-operation and Development.

Statistical activity

Canada's Balance of International Payments is compiled by integrating numerous data sources related to transactions between residents and non-residents into statements that measure the flow of goods, services, incomes and financial claims to and from the economic territory of Canada. The Balance of Payments and International Investment Position Manual, Sixth Edition, published by the International Monetary Fund (IMF) outlines the concepts, methods, accounting identities and accounting framework required to produce Canada's Balance of International Payments. The statistical activity resembles that of a business accountant that is required to take basic company information and summarize it into a series of statements which provides information on the financial health of a business. In the case of Canada's Balance of International Payments basic statistical information is taken from a variety of sources (such as business surveys, government public accounts and statements from financial institutions) and summarized into a Current, Capital and Financial Account which portray the economic interaction between residents and non-residents.

The Canadian System of Macroeconomic Accounts provides a conceptually integrated statistical framework for studying the state and behaviour of the Canadian economy. The accounts are centered on the measurement of activities associated with the production of goods and services, the sales of goods and services in final markets, the supporting financial transactions and the resulting wealth positions.

• Additional documentation

Subjects

• Balance of international payments
• Economic accounts
• Government financial statistics

Data sources and methodology

Target population

The universe for balance of payments purposes embraces all transactors that reside in Canada that engage in international transactions. The transactors can be businesses, governments, non-profit institutions, or households.

Most of the data used to derive the balance of payments originates from surveys of Canadian companies that are asked to consolidate all of their Canadian operations and accordingly are referred to as Canadian enterprises. The survey frame is believed to contain up-to-date coverage of all Canadian enterprises having a significant amount of international transactions. This frame is constantly updated through a number of sources.

Instrument design

There are several questionnaires that collect data that are used directly for compiling Canada's Balance of International Payments. These are:

BP-11 - Gold and silver transactions, assets and liabilities (monthly)
BP-QT - Quarterly investment between Canada and other countries (quarterly)
BP-21S - International transactions in commercial services (annual)
BP-21SQ - International transactions in commercial services (quarterly)
BP-22 - Investment in Canada by non-Canadian corporations (annual)
BP-22A - Investment in Canada by non-Canadian corporations (quarterly)
BP-27 - Transactions between Canadian incorporated insurance companies
and their foreign affiliates, agencies and bank accounts and other companies
or persons outside Canada (annual)
BP-28 - Transactions between Canadian branches and foreign insurance companies
in Canada and head or other offices, companies or persons outside Canada
(annual)
BP-29 - Report by trust and mortgage loan companies in Canada on transactions with non-residents (annual)
BP-31 - Futures trading with non-residents (quarterly)

There are also many other questionnaires that collect data that are used to compile other statistical outputs that ultimately feed into the balance of payments. For information about questionnaires used in other statistical programs that ultimately feed into the Balance of Payments, please follow the links listed in the Data sources section below.

The questionnaires used for the Balance of Payments were originally designed at various times from the 1950's. They have been periodically redesigned up to recently in the case of the financial surveys.

Sampling

This is a sample survey with a cross-sectional design.

The quarterly questionnaires providing direct input to Canada's Balance of International Payments are sent to Canadian enterprises known to have or believed to have significant international activity. Roughly 6000 firms receive the annual questionnaires. Collection of this data on a quarterly basis is limited to approximately 1000 firms with very high levels of international transactions, while there are slightly over 100 firms that are surveyed on a monthly basis.

The annual surveys are believed to cover close to 100% of the target population. Some quarterly data are modelled based on previous annual data.

The BP-21SQ is a probability sample where each unit surveyed has a weight associated with it. Values for surveyed units are multiplied by their respective weights to estimate totals for the target population.

The quarterly surveys use a stratified design with simple random sample selection in each stratum.

Data sources

Responding to this survey is mandatory.

Data are collected directly from survey respondents, extracted from administrative files and derived from other Statistics Canada surveys and/or other sources.

A significant number of data sources are used to compile Canada's Balance of International Payments.

Questionnaires - Data are collected, in part, via monthly, quarterly, and annual questionnaires; response is mandatory for the surveyed entities. Quarterly questionnaires are sent out on the last business day of the quarter. Respondents are instructed to send their completed questionnaires to the International Accounts and Trade Division within four weeks after the end of the quarter. A further follow-up is done over the next two weeks followed by telephone calls.

A number of administrative data sources are also used, such as
- Immigration, Refugees and Citizenship Canada (revenues for issuing migrant permits to non-residents)
- National Defence (revenues from other countries for the use of Canadian military equipments)
- Bank of Canada (geographical distribution of assets and liabilities of Canadian banks; official international reserves)
- Global Affairs Canada (transfer payments and contracts with Canadian service providers, expenses from Canadian embassies abroad)
- Canada Revenue Agency (e.g. withholding tax revenues)
- U.S. Internal Revenue Service (withholding tax paid to U.S. from Canada)
- International Development Research Center (research expenses)
- Bank for International Settlements (BIS) (non-bank deposits abroad; individually supplied by the U.S. Department of the Treasury and Bank of England since the BIS is usually one quarter late in arriving)

Other Statistics Canada surveys such as the Quarterly Survey of Financial Statements are also used to compile Canada's Balance of International Payments.

Other sources - A variety of other sources are used such as financial press, business publications, company reports, etc.

View the Questionnaire(s) and reporting guide(s).