CANADA ECONOMICS
CANADA - US
Prime Minister concludes visit to the United States Boston, United States - May 18, 2018
The Prime Minister, Justin Trudeau, today concluded his visit to the United States, which included stops in New York City and Boston.
During his visit, the Prime Minister met with several business leaders to underscore the importance of the Canada-U.S. partnership, promote Canada as one of the best places to invest, and create more jobs for Canada’s middle class.
In New York City, the Prime Minister addressed graduates at New York University’s 186th commencement ceremony. During his remarks, he encouraged graduates to embrace diversity, including diversity of opinion, and stressed that the leadership we need most today is leadership that brings people together. He also met with Canadian graduating students and was awarded an honourary Doctor of Laws degree.
At the Economic Club of New York, the Prime Minister participated in an armchair discussion and underscored how the Canada-U.S. partnership creates good, middle class jobs on both sides of the border, and that Canada is open for business and an outstanding place to invest.
In Boston, he took part in a roundtable discussion with members of the Canadian Technology Accelerator Boston-Cambridge, where research and innovation were at the forefront of discussions.
On the last day of his visit, the Prime Minister participated in the annual Solve at MIT meeting, an event that brings together hundreds of leaders and innovators from various fields, to explore groundbreaking solutions to global challenges. He then visited the MIT Media Lab and Innovation Exhibition for a first-hand account of the innovative research and technological advances that are defining the future.
Quotes
"Over the past few days, I have had the opportunity to meet with inspiring graduates and business leaders who are finding solutions to age-old problems and shaping our future in ways we couldn’t have imagined even five years ago. We talked about the importance of collaboration and how Canada and the United States can bring innovators together to create more opportunities for Canadians and Americans alike.”
—The Rt. Hon. Justin Trudeau, Prime Minister of Canada
"Canada leads the G7 in economic growth, and has become a top destination for businesses to create jobs, invest, and grow. We will continue to make bold investments in innovation and skills training, and secure Canada’s place as a centre of global innovation, where the next generation of technologies and businesses thrive.”
—The Rt. Hon. Justin Trudeau, Prime Minister of Canada
Quick facts
- Prime Minister Trudeau last visited the United States in February 2018.
- During the visit to New York City and Boston, the Prime Minister met with the senior corporate leadership of the following companies: Honeywell, AppNexus, PepsiCo, WeWork, Wayfair and Etsy.
- Wayfair announced today that it will open its first Canadian warehouse, creating 200 jobs in Mississauga, Ontario.
- Etsy announced on Thursday that it will open an artificial intelligence centre in Toronto, Ontario. This will be company’s third centre and first in Canada. The other two centres are located in San Francisco and at Etsy’s headquarters in Brooklyn.
- Canada and the United States share one of the largest trading relationships in the world. Bilateral trade in goods and services between the two countries was valued at more than $918 billion in 2017, and Canada is the largest secure supplier of energy to the U.S.
- Canada buys more goods from the United States than China, Japan, and the UK combined.
- A total of 680,900 jobs in New York and 211,000 jobs in Massachusetts depend on Canada-U.S. trade and investment.
Prime Minister to travel to the United States: https://pm.gc.ca/eng/
Canada and United States relations: http://
NAFTA
The Globe and Mail. REUTERS. 22 May 2018. ‘Significant’ issues remain in NAFTA negotiations, Mnuchin says
U.S. Treasury Secretary Steven Mnuchin on Monday said major issues remained in talks between the United States, Mexico and Canada to renegotiate the North American free-trade agreement.
“There are still some very significant, open issues,” Mr. Mnuchin said in an interview on CNBC.
“We’ll see where we get over the next few weeks,” he said, adding that he thinks there is still a desire among the three countries to reach an agreement. “We’re still trying to get a new deal done. That is a priority for the President,” Mr. Mnuchin told CNBC.
He added that the Trump administration remained focused on crafting a new NAFTA deal that would require congressional approval, but that U.S. President Donald Trump could consider a possible so-called “skinny deal” that would not.
His comments come as talks to rework the 24-year-old trade accord have intensified in recent weeks.
Mr. Mnuchin has said Mr. Trump is not focused on a specific deadline, but there are pressures given Mexico’s presidential election in July as well as congressional deadlines and U.S. midterm elections in November.
Mexico has said that the remaining issues are not complex. Last week, U.S. Trade Representative Robert Lighthizer said the countries were nowhere near a deal.
U.S. House of Representatives Speaker Paul Ryan has said that the Republican-controlled Congress would need to be notified of a new deal by last Thursday to give lawmakers a chance to approve it before a newly elected Congress takes over in January.
REUTERS. MAY 22, 2018. Canada says top NAFTA officials in constant contact on trade talks
David Ljunggren
OTTAWA (Reuters) - Top U.S., Canadian and Mexican officials are in constant contact about slow-moving talks to revitalize NAFTA and are ready to meet at any time to push the process forwards, Canada’s foreign minister said on Tuesday.
Negotiations to update the North American Free Trade Agreement have stalled as Canada and Mexico try to digest U.S. demands for major changes.
U.S. officials have said some kind of a deal is needed in the next few weeks to prevent the negotiations spilling into campaigns for a Mexican presidential vote on July 1 and mid-term elections for the U.S. Congress in November.
Foreign Minister Chrystia Freeland said she had spoken on Monday with her counterparts driving the file - U.S. Trade Representative Robert Lighthizer and Mexican Economy Minister Ildefonso Guajardo - and they had agreed to meet if necessary.
“That was one of the things we talked about yesterday — all of us are able to get on a plane and meet at the moment when that could bounce the negotiations (forwards). So we are in very close, I would say constant, touch,” she told reporters.
U.S. Treasury Secretary Steven Mnuchin on Monday said major issues remained between the NAFTA nations.
Canada and Mexico are struggling to accommodate U.S. demands for tougher rules of origin that dictate how much of a car must be produced in NAFTA nations to quality for duty-free status.
“I personally do believe that an agreement on rules of origin is really achievable but it is also the case that nothing is done until everything is done,” said Freeland.
A U.S. official said no meetings between the three top ministers were currently scheduled.
The administration of U.S. President Donald Trump, who has regularly threatened to pull out of the 1994 agreement, also wants higher wages in the auto sector.
Additional reporting by David Lawder in Washington; editing by Diane Craft
US - CHINA
The Globe and Mail. REUTERS. 22 May 2018. Trade-war fears ebb as U.S. and China agree to continue talks
BEN BLANCHARD
MICHAEL MARTINA
SUSAN HEAVEY
WASHINGTON - Washington and Beijing both claimed victory on Monday as the world’s two largest economies stepped back from the brink of a global trade war and agreed to hold further talks to boost U.S. exports to China.
Over the weekend, the two sides pledged to keep talking about how China could import more energy and agricultural commodities from the United States so as to narrow the US$335-billion annual U.S. goods and services trade deficit with China, although details and a firm timeline were thin.
The biggest immediate beneficiary appeared to be China, which won a reprieve from threatened tariffs on US$50-billion of its exports to the United States as well as a lifeline for ZTE Corp., a major company whose existence had been threatened by U.S. sanctions.
The United States meanwhile appeared to have won promises of more imports by China, although there were no specifics.
Economists at Morgan Stanley estimated exports of U.S. agricultural products, primarily beef and energy, mostly liquefied natural gas, could add between US$60-billion and US$90-billion to sales to China over a period of years. That is far less than the US$200-billion reduction in China’s trade surplus that President Donald Trump had demanded at the start of talks.
“China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products – would be one of the best things to happen to our farmers in many years!” Mr. Trump wrote on Twitter on Monday.
China’s government praised the cooling of trade tensions with the United States, saying agreement was in both countries’ interests while state media trumpeted what it saw as Beijing’s refusal to surrender to U.S. economic threats.
There were, however, more questions for the Trump administration, which stands accused by critics of selling out on plans to stop the theft of U.S. companies’ trade secrets in exchange for a quick deal to reduce the U.S. trade deficit.
Questions also remained over the administration’s handling of ZTE, a Chinese company that had been sanctioned by Washington and effectively put out of business, but whose fate was made a precondition of last week’s trade talks in a conversation between Mr. Trump and Chinese President Xi Jinping.
Mr. Trump agreed to allow ZTE to stay in business and the United States and China struck a deal to drop their tariff threats while they worked on a wider trade agreement, U.S. Treasury Secretary Steven Mnuchin said on Sunday.
Washington had threatened to impose tariffs on US$50-billion of Chinese imports unless Beijing rectified its theft of U.S. intellectual property. After China responded with its own tariffs on U.S. agriculture, Mr. Trump threatened to impose duties on an additional US$100-billion of Chinese goods, a move that hit global stock markets hard due to fears of rising protectionism.
U.S. Commerce Secretary Wilbur Ross will travel to China next week to help finalize a trade agreement, Mr. Mnuchin said on Monday. Most observers say a firm deal is likely to take a long time.
In an interview earlier with CNBC, Mr. Mnuchin characterized the U.S. tariff plan as suspended, but warned that “the President can always put tariffs back on.”
Speaking at a daily briefing, Chinese Foreign Ministry spokesman Lu Kang said both countries had clearly recognized that the reaching of a consensus was good for all. “China has never hoped for any tensions between China and the United States, in the trade or other arenas,” Mr. Lu said.
But Chinese media was also quick to point out how the country had successfully defended its interests.
Mei Xinyu, a Commerce Ministry researcher, wrote on the WeChat account of the overseas edition of the ruling Communist Party’s official People’s Daily that the agreement preserved China’s right to develop its economy as it sees fit, including moving up the value chain. The deal also focused on China’s “positive position” to increase imports rather than a “negative position” of getting it to cut exports, Mr. Mei said.
The official China Daily said everyone could heave a sigh of relief at the ratcheting down of the rhetoric and cited China’s chief negotiator, Vice-Premier Liu He, as saying the talks had proved to be “positive, pragmatic, constructive and productive.”
During an initial round of talks this month in Beijing, the United States demanded that China reduce its trade surplus by US$200billion. No dollar figure was cited in the countries’ joint statement on Saturday.
Some in U.S. business groups who had been pushing for tougher measures to pressure China to ease long-standing market barriers on U.S. companies expressed disappointment.
James Zimmerman, a Beijingbased lawyer and a former chairman of the American Chamber of Commerce in China, said the Trump administration’s move to walk back its threatened trade actions was premature, and a “lost opportunity” for American companies, workers and consumers.
“The Chinese are in a state of quiet glee knowing that Trump’s trade team backed off on sanctions without getting any real and meaningful concessions out of Beijing,” Mr. Zimmerman said.
But Jacob Parker, vice president of China operations at the U.S.-China Business Council, called the apparent de-escalation in trade tensions “a great bit of progress.”
“We were never supportive of tariffs, so any actions that can be taken to stop those from being implemented are positive from our view,” Mr. Parker said.
REUTERS. MAY 22, 2018. U.S. farmers plow ahead with plantings as China trade war fears ebb
Tom Polansek
CHICAGO (Reuters) - U.S. farmers said they would push ahead with plantings planned before U.S.-China trade tensions eased and, now that the two countries have resumed talks, take a wait-and-see approach to President Donald Trump’s promises for more sales to China.
Over the weekend, the world’s two largest economies pledged to keep talking about how China could import more energy and agricultural commodities from the United States to narrow a $335 billion annual U.S. goods and services trade deficit with Beijing.
The agreement came after Trump threatened to impose up to $150 billion in punitive tariffs to lower the trade deficit and combat what he calls Beijing’s misappropriation of U.S. technology. China threatened equal retaliation, including tariffs on some of its largest U.S. imports, including soybeans and other agricultural commodities.
The reluctance of some farmers to adjust their planting plans in light of the latest negotiations shows they are uncertain about the outcome. For many, it is also simply too late to change their minds after buying seed, fertilizer and farm chemicals.
“We’re so far along in our planting season that we can’t change anything,” said John Brink, who grows corn, soy and wheat in Richview, Illinois.
As of Sunday, farmers had planted 81 percent of the U.S. corn crop, 56 percent of the nation’s soybeans and 36 percent of sorghum, a grain used for livestock feed, according to U.S. Department of Agriculture data issued on Monday.
“Until we see some hard evidence that some major concessions have been made or whatnot, we’re kind of taking a wait-and-see approach,” Brink said. “We just kind of understand this is politics in play.”
The United States appeared to have won promises of more imports by China, although there were few specifics on Monday.
Farmers said they wanted more details.
“The news is encouraging, but a lot of us on the farm would like to hear some contracted sales that have been placed,” said Monte Peterson, a soybean farmer in Valley City, North Dakota.
Kirby Hettver, who was wrapping up soybean planting on his farm in DeGraff, Minnesota, said he wanted to see a long-term deal in place before he makes any changes on his farm in response to trade policies.
“I view it as part of the process,” Hettver, president of the Minnesota Corn Growers Association, said of the latest stage of the U.S.-China talks.
“Our plan for this year was already in place. We had seed bought, fertilizer bought.”
HOPE FOR REDUCED TARIFFS
The U.S. Grains Council, which promotes U.S. exports, would like China to speed up import approvals of U.S. biotech crops such as corn and reduce tariffs on shipments of U.S. ethanol and an ethanol byproduct known as distillers’ dried grains, Chief Executive Tom Sleight said.
On Friday, China dropped an anti-dumping investigation into U.S. sorghum that had raised costs for buyers of the grain.
As a result, the Grains Council may dial back plans made during China’s investigation to find more buyers in other countries for U.S. sorghum, Sleight said.
“We may be not quite so aggressive now because China could come back as a huge buyer,” he said. “You don’t want to build a big market and then not have something to deliver.”
The United States shipped 4.76 million tonnes of sorghum to China in 2017, worth around $1.1 billion and making up the bulk of China’s roughly 5 million tonnes of imports of the grain, according to Chinese customs data.
Some U.S. farmers scrapped plans to plant sorghum this spring, opting for corn instead, after China’s probe halted U.S. sorghum imports.
But Kent Winter, who farms outside Wichita, Kansas, and is president of the Kansas Grain Sorghum Producers Association, was planning to double his sorghum plantings when the latest trade talks were announced. He will plant the crop across about 400 acres in about three weeks, hoping that China resumes U.S. imports soon after ending its anti-dumping probe.
“It gives us more confidence going forward that we can get this foreign market opened back up,” Winter said.
Reporting by Tom Polansek; Editing by Richard Chang
CANADA - CHINA
The Globe and Mail. 22 May 2018. China pledges to exchange tax information with Canada. Move is part of global agreement aimed at tackling tax avoidance and evasion
XIAO XU
It’s valuable for Canada because it gives [the country] more access to more personal financial information than ever before from China.
RICHARD KURLAND, IMMIGRATION LAWYER
China and Canada will exchange tax and financial information for the first time this fall, a move that will give Canadian authorities a window into the activities of some foreign-property owners who evade Canadian taxes in real estate markets such as Vancouver.
The exchange will also give Chinese authorities an ability to track down economic fugitives in Canada.
“It’s valuable for Canada because it gives [the country] more access to more personal financial information than ever before from China,” said Richard Kurland, a Vancouver immigration lawyer who described the development as “huge.”
In the past, China has been dragging its feet to open its accounts on people’s financial information to Canada and other countries, Mr. Kurland said. The information would include bank account information, such as transactions and balances.
The exchange is part of a move by more than 100 jurisdictions in the world that have committed to implementing the Common Reporting Standard, a global agreement for the automatic exchange of tax and financial-account information. The agreements are aimed at combatting tax avoidance and evasion.
Under the standard, all participating countries will require financial institutions to identify financial accounts held by customers who are non-residents for tax purposes and to report these accounts to the customers’ home tax authorities on an annual basis.
Already, Canada has such an arrangement with 61 other countries. China will be among the new partners, starting in September.
China will get the same information in return about its citizens living in Canada, noted University of British Columbia geography professor David Ley, who is also an expert in immigration and housing markets.
“The Chinese are certainly keen to quite vigorously pursue criminal cases, cases where there are claims that people have left China having committed fraud or some other crimes. I think anything that provides a greater prospective of detection will be an interest to China.”
But this could put some residents who run afoul of Chinese law at risk.
“It’s quite possible that people who have difficulties with the Chinese government could be more exposed,” Prof. Ley said.
Carol Dai, accountant and investment immigration tax planning expert in Toronto, said Chinese residents for tax purposes will be more cautious when transferring money overseas and won’t dare to deposit a large amount of money in foreign banks.
She noted some of her clients who are from China are now facing a “dilemma.”
“[They] don’t want to be a Canadian tax resident and pay taxes here, neither do they want their tax information to be exchanged to China.”
Ontario-based accountant Wei Hua has a number of high-net-worth clients who are Canadian residents, but have assets or income overseas.
He noted he has seen an increase in the willingness of these clients to claim their overseas assets and income voluntarily to the Canada Revenue Agency.
“If they fail to claim their overseas assets and incomes, then they are going to face various penalties,” Mr. Hua said.
Prof. Ley said the exchange will be a benefit to Canada.
A Globe and Mail investigation had found that many wealthy foreign families buying Vancouver real estate pay little or no income or capital-gains tax.
The investigation found that these foreign investors declared low incomes despite buying millions of dollars’ worth of property in the names of their spouses and children here, and that they use residency rules to avoid paying capital-gains taxes.
CRA rules say a non-resident who buys and sells Canadian property must pay capital gains and other taxes on earnings from those investments. If the investor has a primary residence and family living in Canada, the investor must file resident tax returns and report all income.
“If Canada is able to share tax records with other countries for Canadian taxpayers, it can access income-generating activities in those countries by Canadian taxpayers that need to be included in Canadian tax returns. In the past, the CRA has had difficulty in accessing this information in China,” Prof. Ley said.
He said the tax-information exchange could result in a cooling of the Vancouver real estate market.
Mr. Kurland agreed. He said that in the short run, before the exchange takes effect, people who failed to properly disclose their transactions will be worried about being discovered and will be motivated to sell their properties.
“If they’re in the position to just sell and take their money away, even if the transactions subsequently are discovered, no one can do anything about it because the person and cash have left town,” Mr. Kurland said. “[The sellers] would rather take a slight loss than risk losing everything. And so that should drag down prices.”
CRA stated in an e-mail to The Globe that there is no legal limit to how far back it can go in cases where a taxpayer intentionally failed to report income or failed to file a return.
The normal reassessment period for most taxpayers is three years, it said, but that can be extended to six years in certain cases, notably where international transactions are involved.
David Chodikoff, a Toronto tax lawyer, wasn’t convinced that the financial-information sharing will lead to better compliance.
“It’s hard to predict what’s going to happen because of how the information will be reviewed, how the information will be used and whether or not there’s a real effort to pursue once that information is obtained, we don’t know yet.”
He was equally skeptical that the agreement will halt foreign investment in the housing market.
B.C.’s Finance Ministry said in an e-mail that the new standard will help enforcement around its tax on vacant properties and its increased foreign-buyers tax.
VENEZUELA
The Globe and Mail. REUTERS. 22 May 2018. Venezuela’s Maduro faces wide criticism, U.S. sanctions after disputed re-election
ALEXANDRA ULMER
ROBERTA RAMPTON
Critics at home and abroad on Monday denounced the re-election of Venezuela’s socialist President Nicolas Maduro as a farce cementing autocracy, while the U.S. government imposed new sanctions on the crisis-stricken oilproducing country.
Mr. Maduro, the 55-year-old successor to late leftist leader Hugo Chavez, hailed his win in Sunday’s election as a victory against “imperialism.” But his main challengers alleged irregularities and refused to recognize the result.
In response to the vote, U.S. President Donald Trump issued an executive order restricting Venezuela’s ability to liquidate state assets and debt in the United States, the latest in a series of sanctions that seeks to choke off financing for the already cashstrapped government.
Venezuela’s mainstream opposition had boycotted the election, given that two of its most popular leaders were barred, authorities had banned several political parties, and the election board is run by Maduro loyalists.
Mr. Maduro won 68 per cent of votes – more than three times as many as his main rival Henri Falcon. Turnout was a low 46 per cent, significantly down from 80 per cent in 2013’s presidential vote.
“The revolution is here to stay!” Mr. Maduro told cheering supporters outside the presidential palace in Caracas. He has not outlined firm policies, but has promised to prioritize economic recovery after five years of crippling recession that has seen many struggle with chronic shortages of food, medicines and other basic necessities.
His dwindling but often still fervent supporters, many of whom remember the generous welfare policies of the Chavez years, want to give him another shot.
“We believe in the process and we’re giving President Maduro another chance,” 45-year-old social-security worker Maira Garcia said.
“He’s going to fix the country’s economy … we’re going to return to being as we were before, or even better,” she said, wearing a tshirt with a big ‘M’ on the front as she celebrated Mr. Maduro’s victory in the poor Caracas hillside neighbourhood of 23 de Enero.
U.S. Vice-President Mike Pence called the election “a sham – neither free nor fair.”
In a statement sent from the White House, Mr. Trump called for Mr. Maduro to “restore democracy, hold free and fair elections, release all political prisoners immediately and unconditionally, and end the repression and economic deprivation of the Venezuelan people.”
In recent months, Washington has imposed a series of sanctions on companies and individuals with ties to the Maduro government.
Mr. Trump’s order on Monday prohibits involvement in the purchase of any debt owed to the Venezuelan government, including accounts receivable, particularly related to oil sold by the OPEC member.
The action appears to target in part Venezuelan-owned but U.S.based oil refiner Citgo.
“Today’s executive order closes another avenue for corruption that we have observed being used: It denies corrupt Venezuelan officials the ability to improperly value and sell off public assets in return for kickbacks,” a senior administration official told reporters in Washington.
While the order applies only to U.S. citizens and residents, the official said the Trump administration had had “fairly pointed discussions” with China and Russia over the issuing of new credit to Venezuela. Mr. Maduro has counted on the support of China and Russia, which have provided billions of dollars in funding in recent years.
“What these sanctions are seeking to avoid is that countries outside the Western hemisphere come rescue Maduro financially so that he can consolidate an autocracy,” Venezuelan opposition lawmaker and economist Angel Alvarado said.
Venezuela’s Information Ministry and state oil company PDVSA did not respond to a request for comment.
Other countries also hinted at sanctions, with Spain leading European Union criticism of the election.
And the 14-country “Lima Group” of countries in the Americas, from Canada to Brazil, said in a stinging statement it did not recognize the vote and would downgrade diplomatic relations. The group deplored Venezuela’s “grave humanitarian situation.”
In contrast, Venezuela’s regional leftist allies, such as Cuba and Bolivia, sent congratulations.
In Beijing, Foreign Ministry spokesman Lu Kang said China believed Venezuela could handle its own affairs and the choice of the people should be respected.
The Venezuelan government used ample state resources to get voters out on Sunday and public workers were pressured to vote.
Mr. Falcon called for a new election, complaining about the government placing of nearly 13,000 pro-government stands offering “prizes” close to polling stations nationwide.
The main political opposition said its boycott had worked, but the disparate group did not appear to have a plan going forward other than calling for new elections – a non-starter given the pro-Maduro electoral council.
Major protests, such as those seen last year and in 2014, seem unlikely, given widespread disillusionment and fatigue.
Demonstrators did barricade some streets in the southern city of Puerto Ordaz, drawing tear gas from the National Guard, witnesses said.
Mr. Maduro, a former bus driver whose second term in office starts in January, faces a colossal task turning around Venezuela’s moribund economy. The bolivar currency is down more than 99 per cent over the past year and annual inflation is at nearly 14,000 per cent, according to the opposition-led National Assembly.
Venezuela’s multiple creditors are considering accelerating claims on unpaid foreign debt, while oil major ConocoPhillips has been taking aggressive action in recent weeks against PDVSA, part of a claim for compensation over a 2007 nationalization of its assets in Venezuela.
U.S. crude hit its highest level since 2014 on Monday amid rising concerns that Venezuela’s oil output could fall further following the election and sanctions.
Trading of Venezuelan government and PDVSA debt was mixed but volumes remained thin in New York on Monday afternoon, with election results considered a formality and offering little to change investor viewpoints.
REUTERS. MAY 22, 2018. Venezuela expels U.S. envoy in response to sanctions
Luc Cohen, Vivian Sequera
CARACAS (Reuters) - President Nicolas Maduro on Tuesday ordered the expulsion of the top U.S. diplomat in Venezuela in retaliation for a new round of sanctions over Venezuela’s widely-condemned election.
The United States was among a string of countries that did not recognize Sunday’s vote.
The 55-year-old successor to Hugo Chavez won re-election easily, but critics said the vote was riddled with irregularities, from the barring of two popular opposition rivals to the offering of a government “prize” to voters.
President Donald Trump responded with an executive order limiting Venezuela’s ability to sell state assets, heightening pressure on the cash-strapped government.
Accusing U.S. charge d’affaires Todd Robinson of being involved in “a military conspiracy,” Maduro ordered him and another senior diplomat, Brian Naranjo, to leave within 48 hours.
He gave no details of the accusations, but said the U.S. Embassy had been meddling in military, economic and political issues, and vowed to present evidence to the nation shortly.
“Neither with conspiracies nor with sanctions will you hold Venezuela back,” Maduro said, at an event in downtown Caracas at the headquarters of the election board, which is run by government loyalists.
Earlier on Tuesday, Venezuela’s foreign ministry called the sanctions “a crime against humanity.” Maduro’s socialist administration, which has long said a U.S.-led “economic war” is to blame for a deep crisis in the OPEC nation, said the new sanctions violated international law.
“Venezuela once again condemns the systematic campaign of aggression and hostility by the U.S. regime to punish the Venezuelan people for exercising their right to vote,” the Foreign Ministry said in a statement. “These arbitrary and unilateral measures constitute a crime against humanity.”
Venezuela’s opposition has accused the Maduro government of behaving immorally and trying to hide shortcomings and corruption behind bombastic rhetoric. The mainstream opposition coalition boycotted Sunday’s vote, calling it a sham aimed at legitimizing Maduro’s rule despite his low popularity.
Among widespread international condemnation of the vote, the European Union said in a statement on Tuesday that the elections did not comply with “minimum international standards for a credible process” and repeated that it would consider the “adoption of appropriate measures.”
LOW TURNOUT
Maduro, whose second term will begin next January, won 68 percent of the vote. Former state governor Henri Falcon, who broke with the boycott to challenge Maduro, said he received reports of hundreds of irregularities.
Turnout was less than 50 percent, compared to 80 percent in 2013.
Electoral council chief Tibisay Lucena, who is on individual U.S. and European Union sanctions lists, certified Maduro’s victory in a presentation on Tuesday.
The latest U.S. sanctions appeared to target in part Citgo, a U.S.-based oil refiner owned by Venezuela state oil company PDVSA [PDVSA.UL]. More obstacles to PDVSA’s ability to sell oil abroad could restrict already-dwindling foreign exchange earnings, worsening the economic crisis and pressuring Maduro.
While it only applies to U.S. citizens and residents, a U.S. official told reporters on Monday that the Trump administration has also tried to convince China and Russia to stop issuing new credit to Venezuela. The two have provided billions of dollars in funding for Venezuela in recent years.
But they appeared unlikely to heed the U.S. warnings. Beijing said on Tuesday it believed the United States and Venezuela should resolve their differences via talks, while Moscow said it would not comply with the sanctions.
In its statement on Tuesday, Venezuela’s foreign ministry blamed the U.S. “blockade” of the country for “blocking the population’s access to basic goods.”
Most mainstream economists say the country’s strict currency controls, heavy state intervention and money-printing are responsible for a crisis that has caused widespread shortages of food and medicine and led to mass emigration.
Reporting by Luc Cohen; Additional reporting by Deisy Buitrago and Andrew Cawthorne in Caracas; Ben Blanchard in Beijing; Robin Emmott in Brussels; editing by Andrew Cawthorne and Rosalba O'Brien
BRAZIL
The Globe and Mail. REUTERS. 22 May 2018. Brookfield’s quest to find value in a crisis. Acquisitions despite Brazil’s wide-ranging corruption probes are a sign the Canadian group is ready to take big risks
TATIANA BAUTZER
Rampant corruption scandals and a deep recession soured many foreign investors on Brazil in recent years, but one Canadian group saw opportunity.
Brookfield Asset Management Inc. and its subsidiaries have made nearly a dozen major acquisitions there since 2013. The companies have spent about US$10-billion on energy, infrastructure and real estate assets few others would touch owing to the legal, political and economic risks involved.
“A crisis is a good time to find value,” said a person close to the group, who called Brookfield a “contrarian investor.”
That includes buying assets from companies entangled in the blockbuster “Car Wash” investigation, which jailed dozens of businessmen and politicians. The deals confirmed Brookfield’s reputation as one of the strongeststomached investors in Brazil.
In 2016, for example, Brookfield Infrastructure Partners LP led a US$5.2-billion acquisition of a pipeline operator from Petroleo Brasileiro SA, the state-controlled oil company at the heart of the Car Wash scandal. Recently, another Petrobras pipeline network with half the capacity fetched a top bid of around US$8-billion from other investors. Bargain-hunting Brookfield gave that deal a pass.
The Canadians’ savvy is built on nearly 120 years of experience in South America’s largest economy. But the recent buying spree pushed the company to new extremes of due diligence and bulletproofing, according to interviews with six people involved in the deals.
The company declined to comment on investments in Brazil, which account for about 15 per cent of its US$286-billion portfolio and represent its biggest market after the United States.
Chief executive Bruce Flatt, whom some call the Warren Buffett of Canada for his value-investing approach, called recent Brazil acquisitions “quality businesses from sellers in need of capital” in a February letter to investors.
Brookfield’s purchase of gas pipeline operator Nova Transportadora do Sudeste SA (NTS) from Petrobras was part of a controversial divestment program aimed at trimming the oil firm’s massive debt load.
Critics have decried the privatizations, and Ciro Gomes, a leading leftist presidential candidate, has pledged to reverse sales of state energy assets if elected this year.
Foreseeing the risk, Brookfield tasked dozens of lawyers with drafting an ironclad agreement. Brookfield has a right to compensation if Petrobras changes the contracts in a way that hurts the Canadians’ cash flow, according to three people with knowledge of the matter.
The head of Brazilian investment banking at a global bank, who was not involved in the NTS deal, said it was an example of Brookfield’s willingness to bet big while protecting itself.
“Everyone was stunned by their US$5-billion bid at the time,” the banker said. That successful deal convinced other investors to consider bidding on the other Petrobras pipeline unit, the person added.
Started in 1899 as the Sao Paulo Railway, Light and Power Cosmpany, Brookfield grew into a diversified global investment firm. Until 2005, it went by the name Brascan, a reflection of its roots as a Canadian investment firm in Brazil.
Brookfield, too, has grappled with graft allegations in Brazil.
Its home-building unit was among around 30 developers accused of paying bribes to building inspectors in Sao Paulo between 2010 and 2012. Former employees of the unit, which later changed its name to Tegra, confessed to paying bribes and were cooperating witnesses in the trial of the building inspectors.
One of Brookfield’s toughest recent deals will test its ability to avoid fallout from another municipal graft scandal.
Last year, it agreed to pay US$1billion for a 70-per-cent stake in a sewage and water utility owned by Odebrecht SA, an engineering group ensnared in the Car Wash probe. Prosecutors accused Odebrecht of paying bribes to secure contracts with some of the 186 municipalities where the utility operates.
Odebrecht, which reached a leniency deal with prosecutors, said in a statement it is cooperating with law enforcement and “has created internal controls to detect and prevent unlawful behavior.”
Some 60 lawyers working for Brookfield spent eight months assessing the risks. They arranged for US$100-million of the purchase price to be set aside to cover potential liabilities if city governments break off contracts or demand compensation owing to alleged kickback schemes.
ARGENTINA
The Globe and Mail REUTERS. 22 May 2018. ANALYSIS. Why Turkey and Argentina are the main emerging-market weak links
MARC JONES, LONDON
Running the numbers on foreign-exchange reserves and general exposure to the U.S. dollar throws up some of the reasons why Turkey and Argentina have been at the heart of the recent emerging market sell-off.
Economists have been quick to pin the blame on problematic politics, high deficits and even higher inflation, but there are many other issues below the surface.
Turkey’s currency reserves compared with debt payments due in the coming year already looked small versus most of its peers, according to Bank of America Merrill Lynch analysis.
As a ratio, those reserves were already under 90 per cent of the country’s 2018 maturing debt, which in the simplest terms means that without access to borrowing markets or generating extra reserves, it would in theory default.
Argentina’s figure is probably close to that too now having sold US$8-billion of its reserves since the start of March in its failed bid to stop a 25-per-cent fall in the value of the peso.
Malaysia and Ukraine’s figure aren’t stellar either, but are at least still above the 100-per-cent threshold deemed to be the safe minimum.
“The bottom line is that everybody except Turkey has good reserves,” said BAML’s David Hauner, adding that capital flows were now the key thing for underpressure emerging markets.
Respected flow tracker, the Institute of International Finance, has looked at other areas of stress, too – such as the currency exposures of banks in a country.
Although most major banking systems in the developing world are much more robust these days, there are exceptions where a crisis could be triggered if dollar-denominated loans start to default.
IIF data point to Argentina’s banks that have high levels of “net open FX positions” – effectively where dollar loans are not balanced out by dollar deposits.
Argentine banks’ net open positions are at 14 per cent and India too looks relatively high at more than 8 per cent. Turkish banks on the other hand look good in this respect at under 1 per cent, thanks to deeply ingrained currency hedging practices.
“If the net open position is high, the possibility of a currency mismatch is high,” IIF capital markets department deputy director Emre Tiftik said. Another area they consider are banks’ loan-to-deposit ratios. If these are more than 100 per cent, as in Turkey, but also in South Africa, Chile, Mexico and Colombia, any significant freeze in lending markets can prove dangerous.
The other obvious pressure point is emerging markets’ record US$3.7-trillion dollar-denominated debt pile after years of ultralow global interest rates.
The Bank for International Settlements – the central bank for the world’s central banks – estimates that China’s firms have US$530-billion of that total, with Mexico next at US$265-billion.
Here too, though, Turkey and Argentina have sizable piles at almost US$200-billion and US$150billion respectively.
DEVELOPMENT
Global Affairs Canada. May 22, 2018. Minister Champagne to promote foreign direct investment on artificial intelligence in Montréal
Ottawa, Ontario - Canada supports free trade and innovative sectors through open markets, reduced trade barriers and by offering an environment that welcomes foreign direct investment.
On May 23, 2018, the Honourable François-Philippe Champagne, Minister of International Trade, will travel to Montréal, Quebec, to meet potential foreign investors and representatives of Canadian high-technology companies at the Commerce Creativity (C2) business conference.
While in Montréal, the Minister will meet with representatives of start-up companies. Later that day, the Minister along with Ian McKay, CEO of Invest in Canada, will co-host an investment round table focused on tech and artificial intelligence (AI) with foreign business leaders attending C2 to discuss opportunities in Canada for this fast-growing sector.
On February 15, 2018, the Government of Canada announced a new investment of up to $950 million to five superclusters under the Innovation Superclusters Initiative. All five superclusters will benefit Canada’s digital industries. In particular the Digital Technology Supercluster, based in British Columbia, will use digital technologies to unlock new potential in important sectors like healthcare, forestry, and manufacturing. The Ontario-based Advance Manufacturing Supercluster and the Quebec-based SCALE.AI Supercluster are both integrating AI into their strategies. The Innovation Superclusters Initiative is a centrepiece of the Government of Canada’s Innovation and Skills Plan, a multi-year strategy to prepare Canada for the innovative jobs of today and tomorrow.
Quotes
“The Canadian AI sector is a global leader, and our impressive talent pool and competitive business environment continues to attract top-tier international companies and investors, including here in Montréal.”
- François-Philippe Champagne, Minister of International Trade
Quick facts
- Canada is a global leader in innovation and technology, where 40% of all Canadian R&D scientists work in the information and communication technologies (ICT) sector. The ICT sector includes over 39,000 companies, employs over 594,000 people and contributes $73 billion (4.4%) to Canada’s GDP.
- Canada’s AI ecosystem consists of over 650 AI companies, largely start-ups in 2018, a 28% increase from 2017. Canada’s tech sector continues to grow and access foreign markets.
- Several Canadian AI initiatives have arisen as a result of Canada’s strategic advantage, including Vector Institute (Toronto, Ontario), Montreal Institute for Learning Algorithms (Montréal), Enterprise Machine Intelligence and Learning Initiative (Winnipeg, Manitoba) and Alberta Machine Intelligence Institute (Edmonton, Alberta). The Creative Destruction Lab at the Rotman School of Management (Toronto) has established itself as a key hub linking AI start-ups with venture capital.
ENERGY
The Globe and Mail. 22 May 2018. Crude hits its highest level since 2014 amid rising concerns that Venezuela’s output could fall further as U.S. threatens sanctions. U.S. sanctions expected for country after President wins re-election in vote denounced as farce
JESSICA RESNICK-AULT, NEW YORK
U.S. crude hit its highest level since 2014 on Monday amid rising concerns that Venezuela’s oil output could fall further following the country’s presidential election and potential sanctions on the Organization of Petroleum Exporting Countries member.
Prices firmed further as U.S. President Donald Trump had discussions with Russia and China about issuing new debt to Venezuela. Mr. Trump signed an executive order on Monday restricting Venezuela’s ability to liquidate state assets, a senior administration official told reporters.
Any restriction on Venezuela’s financing, logistics or power supply could further depress the country’s crude output.
“It’s been going down for a bit, but there is an expectation that the decline will accelerate,” said Jamie Webster, senior director of the Center for Energy Impact at the Boston Consulting Group. “There’s increasingly a view that this could be as bad as Libya was in its worst days - that production could fall to a very small percent of what it is capable of doing.”
U.S. crude futures settled 96 US cents, or 1.4 per cent, firmer at US$72.24 a barrel, after touching US$72.33, the highest since November, 2014. In postsettlement trade, the benchmark hit a fresh 31⁄2-year high at 72.41. Brent crude futures gained 71 US cents, or 0.9 per cent, to settle at US$79.22 a barrel.
Venezuela’s socialist President Nicolas Maduro faced widespread international condemnation on Monday after his reelection in a weekend vote his critics denounced as a farce cementing autocracy in the crisisstricken oil producer.
The United States is actively considering oil sanctions on Venezuela, where output has dropped by one-third in two years to its lowest in decades.
“The spectre of U.S. oil sanctions on the embattled Latin American producer now looms large as Washington strives to tighten the financial noose,” PVM Oil Associates strategist Stephen Brennock said in a note.
Brent pushed past US$80 a barrel last week for the first time since 2014, and the market may again try to clear that hurdle, said Gene McGillian, vice-president of research at Tradition Energy in Stamford, Conn.
“It seems as if the pull backs are just short-term profit taking and we will see whether people are going to be willing to drive the market through $80 again,” he said.
Beyond Venezuela’s production woes, geopolitical concerns that U.S. sanctions on Iran could curb the country’s crude exports have led prices to trade higher in recent weeks.
Additionally, a possible U.S. trade war with China is “on hold” after the world’s two largest economies agreed to drop their tariff threats while they work on a wider trade agreement, U.S. Treasury Secretary Steven Mnuchin said on Sunday, giving global markets a lift in early Monday trade.
Stabilizing trade relations between the countries could boost oil demand, Tradition’s Mr. McGillian said.
Rising output from U.S. shale and key OPEC producers could end the rally, BP chief executive Bob Dudley said. Mr. Dudley said he expected a flood of U.S. shale and a possible reopening of OPEC taps to cool oil markets after crude rose above US$80 a barrel last week.
Mr. Dudley said he saw oil prices falling to between US$50 and US$65 because of surging shale output and OPEC’s capacity to boost production to cover a potential shortfall in Iranian supplies owing to U.S. sanctions.
REUTERS. MAY 22, 2018. OPEC may decide to ease oil supply curbs in June: sources
Rania El Gamal, Alex Lawler
KHOBAR, Saudi Arabia/LONDON (Reuters) - OPEC may decide to raise oil output as soon as June due to worries over Iranian and Venezuelan supply and after Washington raised concerns the oil rally was going too far, OPEC and oil industry sources familiar with the discussions told Reuters.
Gulf OPEC countries are leading the initial talks on when the exporting group can boost oil production to cool the oil market after crude rose above $80 a barrel last week, and how many barrels each member can add, the sources said.
The Organization of the Petroleum Exporting Countries and non-OPEC producers led by Russia have agreed to curb output by about 1.8 million barrels per day (bpd) until the end of 2018 to reduce high global oil stocks, but the inventory overhang has now fallen close to OPEC’s target.
“All options are on the table,” one Gulf oil source told Reuters, adding that a decision to raise output might be taken in June when OPEC next meets to decide on its output policy, but there is no certain number yet by how much the group would need to ease its oil supply curbs.
OPEC and its non-OPEC allies may opt to relax record high compliance with the supply curb agreement, another source said.
OPEC’s compliance with the deal reached an unprecedented 166 percent in April, meaning it has cut well above its target.
“We are still studying the different scenarios,” the second source said, adding that even if OPEC decided to ease the output restrictions in June it may take three to four months to put into effect.
“That is one of the options,” an OPEC source said, referring to adding more supply at the June meeting.
Falling Venezuelan output due to an economic crisis has helped OPEC and its allies deliver a bigger cut than intended.
Saudi Energy Minister Khalid al-Falih is set to meet his counterparts from Russia and the United Arab Emirates, which holds the OPEC presidency in 2018, in St. Petersburg this week to discuss this issue, sources said.
So far, OPEC has said it sees no need to ease output restrictions despite a fall in global stocks to the group’s desired levels and concerns among consuming nations that the price rally could undermine demand.
But the sources said that the quick decline in global oil inventories and worries about the impact on oil supplies after the U.S. decision to withdraw from the international nuclear deal with Iran, as well as Venezuela’s collapsing oil output, were behind the change in OPEC’s thinking.
Concerns raised by the United States that oil prices were too high also made the exporting group start internal discussions, the sources added.
U.S. President Donald Trump accused OPEC last month of “artificially” boosting oil prices.
Last week, Falih, OPEC’s most influential energy minister, said he had called his counterparts in the UAE, the United States and Russia, as well as major oil consumer South Korea, to “coordinate global action to ease global market anxiety”.
Earlier this month, an OPEC source familiar with the kingdom’s oil thinking told Reuters that Saudi Arabia is monitoring the impact on oil supplies of the U.S. withdrawal from the Iran nuclear deal and is ready to offset any shortage but it will not act alone to fill the gap.
Reporting by Rania El Gamal; Editing by Adrian Croft
REUTERS. MAY 21, 2018. Oil jumps back above $80 a barrel on mounting supply concerns
Stephanie Kelly
NEW YORK (Reuters) - Brent crude oil jumped 1.5 percent to above $80 a barrel on Tuesday, supported by concern that falling Venezuelan crude output and a potential drop in Iranian exports could further tighten global supply.
Brent crude futures LCOc1 rose $1.19 to $80.41 a barrel, a 1.5 percent gain, by 11:12 a.m. EDT (1512 GMT). Last week, the global benchmark topped $80 for the first time since November 2014.
U.S. West Texas Intermediate (WTI) crude CLc1 rose 59 cents to $72.83 a barrel, a 0.8 percent gain. It earlier touched $72.83 a barrel, highest since November 2014.
The U.S. government imposed new sanctions on Venezuela following Sunday’s re-election of President Nicolas Maduro, a move that analysts say could further curb the country’s oil output, already at its lowest in decades.
“The impact is more fear-related that we’ll see more barrels come off the market,” said Rob Haworth, senior investment strategist for U.S. Bank Wealth Management.
Also supporting prices is the concern about a potential drop in Iranian oil exports following Washington’s exit from a nuclear arms control deal with Tehran.
On Monday, the United States demanded that Iran make sweeping changes - including dropping its nuclear program to pulling out of the Syrian civil war - or face severe economic sanctions. Iran dismissed Washington’s ultimatum and one senior Iranian official said it showed the United States is seeking “regime change” in Iran.
Venezuela and Iran are members of the Organization of the Petroleum Exporting Countries, which with its allies has curbed production since January 2017 to get rid of a supply glut that in mid-2014 led to a price collapse.
Due in part to the involuntary drop in Venezuela’s output, OPEC is over-delivering on the agreement. Saudi Arabia and other major OPEC producers could in theory add more supply, but have yet to do so.
The OPEC-led supply curbs have largely cleared an inventory surplus in industrialised countries based on the deal’s original goals, and stocks continue to decline.
U.S. crude stockpiles are forecast to have declined by 2.8 million barrels last week, which would be the third straight weekly fall. The American Petroleum Institute’s inventory report for the period is due at 4:30 p.m. EDT (2030 GMT). [EIA/S]
Limiting the upward pressure on prices is rising supply in the United States, where shale production is forecast to hit a record high in June.
Additional reporting by Alex Lawler in London and Jessica Jaganathan in Singapore; Editing by Marguerita Choy and Adrian Croft
WHOLESALE
StatCan. 2018-05-22. Wholesale trade, March 2018
- Wholesale sales — Canada: $62.8 billion, March 2018, 1.1% increase (monthly change)
- Source(s): CANSIM table 081-0011: http://www5.statcan.gc.ca/cansim/a26?lang=eng&retrLang=eng&id=0810011&&pattern=&stByVal=1&p1=1&p2=31&tabMode=dataTable&csid=
Wholesale sales rose 1.1% to $62.8 billion in March, more than offsetting the decline in February. The motor vehicle and parts subsector contributed the most to the gain. Excluding this subsector, wholesale sales rose 0.2%.
Sales were up in four of seven subsectors in March. In volume terms, wholesale sales rose 0.8%.
In the first quarter of 2018, wholesale sales rose 0.5% in current dollars and 0.4% in constant dollars compared with the fourth quarter of 2017. For both current and constant dollars, this marked the eighth consecutive quarterly increase
Chart 1: Wholesale sales increase in March
Higher sales in four subsectors
The motor vehicle and parts subsector recorded the largest gain in dollar terms, with sales rising 5.0% to $11.8 billion, following three consecutive monthly declines. Lower sales in the other two industries within the subsector were outweighed by gains in the motor vehicle industry (+6.6%), where sales rose following five consecutive monthly declines. This was the highest sales level since the record high in September 2017 for both the subsector and the industry. Imports of passenger cars and light trucks were up in both February and March.
Sales in the building material and supplies subsector increased 3.4% to a record high $9.2 billion. Sales were up in every industry, led by the metal service centres industry (+9.4% to $1.9 billion). Related indicators including imports of metal and non-metallic mineral products and the Industrial Product Price Index for primary ferrous metal products and primary non-ferrous metal products also increased in March.
The personal and household goods subsector rose 0.6% to $8.8 billion. Gains in the pharmaceuticals and pharmacy supplies industry (+3.6%) offset declines in other industries.
Sales in the food, beverage and tobacco subsector declined for the second consecutive month, down 1.4% to $11.9 billion in March. The food products industry (-1.5%) accounted for most of the decline in the subsector.
Sales in the machinery, equipment and supplies subsector fell for the second time in three months, down 0.5% to $12.6 billion in March. The computer and communications equipment and supplies (-3.2%) and the construction, forestry, mining, and industrial machinery, equipment and supplies (-2.5%) industries led the declines.
On a quarterly basis, the food, beverage and tobacco (+2.0%) and the machinery, equipment and supplies (+1.8%) subsectors led the gain in the first quarter of 2018, their second consecutive quarterly gain. The gains in these subsectors were attributable to record high sales in January (food) and February (machinery).
Sales up in two provinces, led by Ontario
Sales were up in two provinces in March, which together accounted for 56% of wholesale sales in Canada. In dollar terms, Ontario contributed the most to the gains.
Sales in Ontario rose 2.5% to $32.8 billion in March, on the strength of higher sales in four of seven subsectors. This was the largest monthly increase for the province since January 2017. The motor vehicle and parts subsector (+7.7%) contributed the most to the gain, following five consecutive monthly declines. The building material and supplies subsector (+8.0%) also contributed to higher sales in Ontario with its second consecutive monthly gain.
In Saskatchewan, sales increased for the first time in five months, up 2.5% to $2.1 billion, on the strength of higher sales in three subsectors. The gain was led by higher sales in the miscellaneous subsector (+11.6%), following a 12.1% decline in February. The agricultural supplies industry contributed the most to the gains in the miscellaneous subsector.
Sales were down in Quebec for the fourth time in five months, declining 0.6% to $11.2 billion. Lower sales in the food, beverage and tobacco (-6.2%) and the building material and supplies (-2.5%) subsectors contributed the most to the decline. The food, beverage and tobacco subsector declined for the first time in 2018, while the building, material and supplies subsector decreased for the second time in three months. Despite the decline in March, sales in Quebec were up 0.1% in the first quarter of 2018, their eighth consecutive quarterly increase.
Following three consecutive gains, sales in Alberta declined 0.7% to $6.7 billion in March, led by the machinery, equipment and supplies subsector (-2.6%). This subsector has declined 4.5% in value over the past two months.
Inventories edge down in March
Wholesale inventories edged down 0.1% in March to $82.6 billion. Decreases in three subsectors, representing 32% of total wholesale inventories, were offset by gains in three other subsectors.
Chart 2: Inventories edge down in March
Inventories in the motor vehicle and parts subsector decreased 1.3% in March, accounting for the largest drop in dollar terms. The motor vehicle industry (-3.0%) was the sole contributor to the decline.
The personal and household goods subsector (-0.6%) decreased for the first time in 2018. Lower inventory levels in the personal goods industry (-6.1%) contributed the most to the drop.
Higher inventories in the building material and supplies subsector (+0.8%) were led by higher stock levels in the metal service centres industry (+4.6%).
Inventories in the miscellaneous subsector (+0.5%) rose for the fourth time in five months, led by the recyclable material (+16.0%) and agricultural supplies (+1.0%) industries.
The inventory-to-sales ratio decreased from 1.33 in February to 1.31 in March. This ratio is a measure of the time in months required to exhaust inventories if sales were to remain at their current level.
FULL DOCUMENT: http://www.statcan.gc.ca/daily-quotidien/180522/dq180522a-eng.pdf
REUTERS. MAY 22, 2018. Canada wholesale trade jumps 1.1 percent in March on autos, parts
OTTAWA (Reuters) - Canadian wholesale trade jumped by 1.1 percent in March, the largest month-on-month rise for five months, thanks largely to strength in the motor vehicle and parts subsector, Statistics Canada said on Tuesday.
The increase - greater than the 0.6 percent advance forecast by analysts in a Reuters poll - was the largest since the 2.0 percent gain seen in October 2017. Statscan revised February’s decline to 0.4 percent from an initial drop of 0.8 percent.
Sales though only rose in Ontario - the most populous of Canada’s 10 provinces - and Saskatchewan in the west. Wholesale trade grew in four out of seven sectors in March, accounting for 49 percent of wholesale trade.
Removing the effects of price changes, sales volumes rose 0.8 percent from February.
After three consecutive monthly falls, the motor vehicles and parts subsector posted a 5.0 percent gain on the back of motor vehicles sales, which rose to a near record high.
Sales in the building materials and supplies subsector increased by 3.4 percent to a record high while the food, beverage and tobacco subsector saw trade drop by 1.4 percent, the second consecutive dip.
Reporting by David Ljunggren; Editing by Chizu Nomiyama
BUDGET
Department of Finance Canada. May 17, 2018. Securing Canada's Economic Future: Minister Morneau Speaks at Toronto Region Board of Trade
Toronto, Ontario – The Government of Canada is focused on the things that matter most to Canadians: growing the economy, creating jobs, strengthening the middle class, and helping everyone working hard to join it. The Government's investments in Canadians and their communities are good for business and good for middle class jobs.
Finance Minister Bill Morneau today spoke with the Toronto Region Board of Trade about how the Government is securing Canada's economic future by making investments in skilled workers, modern infrastructure, global trade and science and innovation, as well as by encouraging workforce participation so that Canada can continue to compete globally and succeed. These investments will deliver long-term growth that works for everyone, while ensuring that Canada remains one of the best places in the world to start, grow, and invest in a business.
Earlier this week Minister Morneau announced Government action to support investor confidence by committing to indemnify the Trans Mountain Expansion Project against any financial loss posed by politically motivated unnecessary delays. The completion of this project will create jobs and support Canada's communities—including Indigenous communities—and benefit all Canadians by providing a safe and efficient means of getting our natural resources to international markets where they will realize greater profits for Canadians. With revenues from this project, governments across Canada will have more to invest in the vital services that Canadians depend on to get ahead.
Quote
"It should be clear to all that Canadians are competitive. They work hard, compete and succeed. The facts show that business confidence and investment is up, and growing faster than it has in five years. And we are taking action to build on that success. By strengthening the internationally competitive environment for Canadian businesses, the Government is attracting investments that contribute to Canada's economic growth and creating jobs that support families and communities. Getting it right will take an open dialogue based on the facts, and listening to Canadians. I look forward to advancing this dialogue with Canadians in the weeks and months ahead."
- Bill Morneau, Minister of Finance
Quick Facts
The Government is investing to help Canadians succeed, with:
- More modern and resilient infrastructure that moves people more efficiently and gets goods to market more quickly and safely.
- Greater investments in people, so that Canadian workers will gain the skills they need to compete for jobs in the new economy, middle class families will have more help with the high cost of raising their kids, and people working hard to join the middle class will have more opportunities to succeed.
- Better support for innovation and science, so that Canadian businesses and workers will be more productive, and better able to compete globally.
- Trade and investment deals that are comprehensive and progressive, so Canadian businesses will have better access to global markets and the billions of customers they represent, and the benefits of growth can be felt by more and more people here at home, and around the world.
FULL DOCUMENT: https://www.fin.gc.ca/n18/18-034-eng.asp
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LGCJ.:
