Stock of Canadian direct investment abroad grew by 9.4% in 2013, reflecting increased investment activity, upward revaluation effects of weaker Canadian dollar; foreign direct investment in Canada advanced 9.5%, led by US: Statistics Canada

OTTAWA , April 25, 2014 (press release) – The stock of Canadian direct investment abroad grew by 9.4% in 2013, reflecting both increased investment activity as well as the upward revaluation effects of a weaker Canadian dollar. The level of foreign direct investment in Canada (+9.5%) advanced at a similar pace during the year, led by investment from the United States.

Canada's net direct investment asset position reached $93.0 billion in 2013, up slightly from 2012. Canadian direct investment abroad increased by $66.7 billion to $779.3 billion at year end. On the other side of the ledger, foreign direct investment in Canada advanced $59.5 billion to $686.3 billion.

Chart 1 
Foreign direct investment position
Combined line chart – Chart 1: Foreign direct investment position, from 1997 to 2013

Chart description: Foreign direct investment position

CSV version of chart 1

Gains in stock of Canadian direct investment abroad focused in the United States and the United Kingdom

Most of the increase in Canada's direct investment asset position in 2013 occurred in the United States and United Kingdom, which remained the two top destinations for Canadian investment. The investment position in the United States increased by $28.6 billion to $317.7 billion at the end of the year. At the same time, Canadian firms added $9.5 billion to their direct investment position in the United Kingdom for a total position of $86.0 billion.

Aside from investment, generally stronger foreign currencies relative to the Canadian dollar also supported the growth of Canadian direct investment assets abroad during the year. This resulted in an upward revaluation of these foreign currency-denominated assets.

Stocks of foreign direct investment to Canada led by the United States, while investment from the Asia/Oceania region continues to expand

Increased investment from the United States accounted for a little over half of the overall gain in foreign direct investment in Canada in 2013, rising by $32.0 billion to $352.1 billion.

Most of the remaining increase was split between the regions of Europe and Asia/Oceania. Europe remained the second largest source of foreign direct investment placed in Canada, accounting for about one-third of total investment. However, Asia/Oceania has increased its share of foreign direct investment in Canada over the past decade, rising from 4.8% in 2003 to 13.1% in 2013.

Canadian direct investment abroad in manufacturing picks up

Following several years of little or no growth, Canadian direct investment abroad in the manufacturing sector picked up in 2013, rising by 17.6% to $72.8 billion. Despite this increase, the share of Canadian investment abroad going into the manufacturing sector has fallen from a peak of 31.9% in 2000 to 9.3% in 2013.

Almost half of the increase in the stock of Canadian direct investment abroad was channelled into the finance and insurance sector, up $29.4 billion to $312.9 billion. The sector maintained its position as the primary destination for investment with a 40.2% share of overall Canadian direct investment abroad.

Manufacturing and mining account for the bulk of foreign direct investment in Canada

Increased investment in the manufacturing and mining sectors accounted for about two-thirds of the growth in foreign direct investment in Canada in 2013. Manufacturing maintained its position as the primary destination for foreign investment with a 30.5% share of overall investment, followed by mining and oil and gas extraction with 20.3%.

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