OTTAWA — Canadians got another morsel of encouraging economic news Tuesday as the country’s monthly trade surplus increased to $1.1 billion, but the data details left a dubious aftertaste.
And another report showed an ongoing swelling in the ranks of the bankrupt.
Insolvencies in March totalled 14,244, up 15.6 per cent from February and 51.3 per cent from March of last year. On the positive side, business bankruptcies were down from a year ago. But growing numbers of individuals were overwhelmed by their debts.
The $1.1-billion surplus in Canada’s merchandise trade with the world was quadruple the upwardly revised $262-million surplus in February, which had followed deficits in December and January — the only months since the mid-’70s when imports outweighed exports.
The March surplus was more than double the $500 million expected by economists.
“The headlines will focus on Canada’s larger trade surplus in March; too bad that it came for all the wrong reasons,” commented Krishen Rangasamy of CIBC World Markets.
“March’s surplus was entirely due to a large drop in imports, which signifies weakening domestic demand, and the drop in exports emphasizes that global demand is still very weak.”
Meanwhile, the statistics from the federal Office of the Superintendent of Bankruptcy showed 11,085 bankruptcies in March along with 3,159 proposals — formal attempts to settle with creditors on easier terms, likely to end in bankruptcy if the creditors refuse.
Consumer insolvencies totalled 13,629, up 16.4 per cent from February and 56.6 per cent from March 2008.
Alberta again showed the steepest provincial rise, with consumer insolvencies up 85 per cent from a year ago at 1,090 and overall insolvencies rising 76 per cent to 1,125.
Total insolvencies were up by 71 per cent year-over-year to 1,176 in B.C., by 57 per cent to 6,300 in Ontario, and by 42 per cent to 4,025 in Quebec.
However, the national total of 615 business insolvencies in March was up by a single case from February, and it was down by 14 per cent from 715 in March of last year.
There were 507 business bankruptcies in March, up 6.7 per cent from February but down 10.3 per cent from a year earlier. And the month’s 108 business proposals were down 22 per cent from February and 28 per cent year-on-year.
The first-quarter national total of 37,339 insolvencies — 28,972 bankruptcies and 8,367 proposals — was up 10.5 per cent from the fourth quarter and up 32.6 per cent from the first three months of 2008.
In the trade report, Statistics Canada said exports and imports both continued declining in March, but imports decreased more than twice as fast as exports, dropping 4.4 per cent on the month to $31.4 billion.
Exports were down 1.8 per cent to $32.5 billion, with an ongoing slide in shipments to the United States partly offset by more exports to Europe.
Statistics Canada noted that since trade activity peaked last July, imports have fallen by more than $8 billion, while exports have slumped $11.8 billion, pulled down by tumbling energy and automotive exports.
However, the agency observed that the pace of decline in both imports and exports in March was slower than in late 2008 and early this year.
“The gradual turn in trade provides another sign that the broader economy is moving away from the murky depths at the start of the year,” commented BMO Capital Markets economist Douglas Porter.
“However, the details of the release — declines in both imports and exports — suggest that it’s still too soon to say that we have resurfaced.”