Canada's International Travel Deficit Rises, Cross Border Shopping Blamed

Canada's international travel deficit climbed to its highest level ever in the third quarter of 2007, as spending by Canadians in the United States reached record levels. Cross-border shopping, due to high loonie, drove up the deficit.

Statistics Canada reports that Canada's international travel deficit has climbed to its highest level ever in the third quarter of 2007; this coincides with the fact that spending by Canadians in the United States reached record levels. The deficit -- the difference between spending by Canadian residents abroad and spending by foreigners in the country -- has jumped to an estimated $2.5 billion in the third quarter which is up $281 million from the second quarter. The spending by Canadian residents is in other countries, but for the most part the United States drove the deficit up. Canadian travelers spent $6.7 billion outside the country in the third quarter, 4.9% more than in the second quarter. In 11 of the last 12 quarters, travel spending by Canadians abroad has increased. Visitors to Canada also spent more in the third quarter of 2007, but to a much lesser extent; travelers from abroad spent $4.2 billion in Canada. This is 0.8% more than the second quarter and the highest amount in two and a half years.