Economic Data
Total GDP (in U.S.$): $825.3 billion (1998)
GDP Growth: 3.3% (1998), 3.1% (1999 est.)
Per Capita GDP (in U.S.$): $26,920 (1998)
Inflation: 1.4% (1998), 1.6% (1999 est.)
Unemployment Rate: 8.5% (1998), 8.3% (1999 est.)
Trade Balance: +$14.3 billion (1998), -$2.9 billion (1999 est.)
Trade with RI: Canada is Rhode Island’s largest export destination, with $371 million in exports in 1998.
Exports (U.S.$): $370.6 billion: motor vehicles and parts, newsprint, wood pulp, timber, crude petroleum, machinery, natural gas, aluminum, telecommunications equipment. Export trading partners: US 81%, Japan 4%, UK, Germany, South Korea, Netherlands, China (1997).
Imports (U.S.$): $356.3 billion: machinery and equipment, crude oil, chemicals, motor vehicles and parts, durable consumer goods. Import trading partners: US 76%, Japan 3%, UK, Germany, France, Mexico, Taiwan, South Korea (1997).
Best Prospects for Export: Computers and Peripherals, Computer Software, Telecommunications Equipment, Automotive Parts and Service Equipment, Building Products, Travel and Tourism Services, Furniture, Medical Equipment, Pollution Control Equipment, Apparel.
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It’s a trip down memory lane for American Industrial Casting of East Greenwich. Last month, the company again began exporting to Canada with a new contract for three to five years worth almost $1 million. And with a new sales representative, Bob Marcille assigned to the area, the company has high hopes for its latest endeavor.
“We had a couple of customers in the past, but over time we had stopped exporting there,” said Charlene Carducci, office manager. “But in the last month or so we got another order and we believe the market is really going to be good for us.”
The company has been manufacturing cast materials since it was founded in 1983 and currently has close to 125 employees. Carducci said the company supplies both non-ferrous casting materials such as aluminum, brass and bronze, and ferrous materials such as stainless steel and currently also exports to Puerto Rico and the United Kingdom.
Carducci said Canada will provide the company with an opportunity to grow and stay competitive.
“There are so many companies that do manufacturing that in order for us to grow we had to look at different areas,” she said. “This will provide us an opportunity to experience with new products, and new customers.”
According to Carducci, though it is still a new project, the company expects that almost 10 percent of its business will be in exporting to Canada.
“We did a market survey to see how we would do,” she said. “And we believe that there is a good potential for new customers in the area, and with that comes new business.”
Carducci said the company is very confident in Marcille, and his ability to make connections in the area. As a former resident of Canada, Carducci said Marcille has “quite a few connections and strong ties in many areas of the country.”
Because the company has exported to Canada before, Carducci doesn’t imagine major obstacles in the process. She said the company requires that each customer supply the documents needed to transport the equipment. Carducci said the only other obstacle could be the language difference in certain provinces, but said many of the company’s employees that will be working in the area are fluent.
“Our staff is just another plus for us,” she said. “I think that we already have a strong tie to the country and will continue on the same path.
Canada
Location: Northern North America, bordering the North Atlantic Ocean and North Pacific Ocean, north of the continental U.S.
Geographic Area: 9,976,140 sq. kilometers, slightly larger than US
Climate: Varies from temperate in south to sub-arctic and arctic in north.
Main Cities: Ottawa (capital), Toronto, Montreal, Vancouver.
Population: 30,675,398 (July 1998 est.)
Languages: English and French. English is the language spoken in the majority of the country and is the generally accepted language of business. French is spoken primarily in Quebec and is the official language of that province.
Time Zone: Canada has the same four Standard Time Zones as the U.S. plus the Atlantic Standard Time (one hour ahead of Eastern Standard Time). Newfoundland Island maintains a separate time zone that is 30 minutes ahead of Atlantic Standard Time.
Workweek: Business hours are 9:00 a.m. to 5:00 p.m., Monday through Friday. Shop hours are generally 10 a.m. to 6 p.m., Monday through Saturday, although many shops are open until 9:00 p.m.
Type of Government: Canada is a federation with parliamentary democracy. Queen Elizabeth II of the UK is a hereditary monarch who appoints a governor general for a five-year term on the advice of the Prime Minister. Parliament consists of the Senate and the House of Commons. After legislative elections, the leader of the majority party in the House of Commons is automatically designated by the governor general to become Prime Minister.
Administrative divisions: Ten provinces and three territories: Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland, Nova Scotia, Ontario, Prince Edward Island, Quebec, Saskatchewan. The territories are Yukon Territory and Northwest Territories, which was split in two as of April 1999. The new eastern section is named Nunavut, and the western keeps the old name Northwest Territories).
Head of government: Prime Minister Jean Chretien (November 4, 1993)
Currency: 1 Canadian dollar (Can$) = 100 cents.
Exchange Rate: US$1=Can$1.4686 (September 30, 1999)
Economic and Political Conditions: After a period of strong growth and austere fiscal and monetary policies designed to eliminate inflation and chronic budget deficits, the Liberal government of Prime Minister Jean Chretien remains comfortably popular. The second quarter of 1999 was the 16th consecutive quarter of growth for the Canadian economy. A surge in business investment and a strong demand for housing were the main reasons for the healthy 3.3% rate of growth. Canada also reported a sharp gain in the trade surplus in July, a figure equivalent to a C$38 billion annual surplus, though mostly due to rising commodity prices.
Tarriffs, Trade,Taxes, Trademarks
Trade Regulations and Tariffs: As a result of the U.S.-Canada Free Trade Agreement (FTA) that went into effect in January 1989, virtually all Canadian tariffs on U.S. products have been eliminated as of January 1998. The North American Free Trade Agreement (NAFTA), which went into effect January 1994, removed some remaining barriers and expanded specific provisions of the FTA. There are, however, provisions related to a variety of prohibited, controlled and restricted goods. Canada’s fear that its own cultural identity will be overwhelmed by neighboring and powerful U.S. cultural influences has resulted in restrictions on foreign investment in Canadian cultural industries.
Taxation: On January 1, 1991, the Canadian Federal Sales Tax (FST) was replaced with the federal Goods and Services Tax (GST). This is a multi-stage tax on consumption and is charged at a rate of 7 percent on most transactions in Canada. Since the GST is a value-added tax, manufacturers and businesses in the distribution chain pay tax only on the value added to the product or service. The general corporate tax rate is 28 percent, although a recent 5 percent reduction for manufacturing and processing income cuts the effective rate on such income to 23 percent.
Documentation: A properly completed Canada Customs Invoice or its equivalent is required for all commercial shipments valued at more than C$1,200 (approximately U.S.$880) exported to Canada. In addition to the Canada Customs Invoice, shipments must be accompanied by a completed exporter’s Certificate of Origin, which is required in order to obtain specialized tariff treatment under the provisions of the NAFTA.
Free Trade Zones: With the exception of one special trade zone at the Sydport Industrial Park in Cape Breton, Nova Scotia, Canada has no free ports or free trade zones. At present, there are no federal or provincial laws specifically governing the establishment and operation of such zones.
Trade Finance: There are no U.S. Government programs available for financing U.S. exports to Canada. Neither the Export-Import Bank of the United States (EXIMBANK) nor the Overseas Private Investment Corporation (OPIC) maintains programs for the Canadian market. However, the political, economic and commercial systems in Canada are so stable and similar to those in the United States that the lack of government financing should pose virtually no problem to the overwhelming majority of U.S. firms seeking to export to Canada. Private financing should be easily available from a U.S. firm’s own bank in the United States, or from a Canadian bank with branch operations in the United States.
Marketing and Selling Factors: In spite of Canada’s vast size, sales to Canadian industries are expedited through relatively short marketing channels with direct producer-to-user distribution taking on primary importance. On the other hand use of marketing intermediaries in consumer goods is prevalent. Toronto, the largest metropolitan area and the center for national distribution networks in many product sectors, is usually the most logical location for establishing sole representation.
Patents/Trademarks/Copyrights: Patents in Canada are governed by the Patent Act. The Act allows for patenting of processes as well as products. Canada has a “first to file” system with an absolute novelty requirement. The term of a patent is 20 years from the filing date.
Key Contacts – Canada
Rhode Island Export Assistance Center (RIEAC) and World Trade Center, Bryant College
Raymond W. Fogarty, Director
Edward Barr, World Trade Center Manager
Telephone: (401) 232-6407 or (401) 232-6408
Fax: (401) 232-6416
E-Mail: postoffice@itdn.net Website: http://www.rieac.org
Rhode Island Economic Development Corporation (RIEDC)
Maureen Mezei, International Trade Director
Telephone: 222-2601, ext. 123 E-Mail: mmezei@riedc.com
U.S. Export Assistance Center, Department of Commerce
Keith M. Yatsushashi, International Trade Specialist
Telephone: (401) 528-5104 E-Mail: kyatsuha@mail.doc.gov
U. S. Small Business Administration
Marilyn Bogue, International Trade Officer
Telephone: 528-4585 E-Mail: marilyn.bogue@sba.gov
Embassy of Canada
501 Pennsylvania Avenue N.W.
Washington, D.C. 20001
Telephone: (202) 682-1740 Fax: (202) 682-7726
Canadian Consulate General — Boston
Three Copley Place, Suite 400
Boston, Massachusetts 02116
Tel: (617) 262-3760 Fax: (617) 262-3415
Territory: Maine, Massachusetts, New Hampshire, Rhode Island, and Vermon
Country Profile
Compiled by Providence Business News,
in collaboration with Bryant College Export Assistance Center.
