Canada and the United States are reportedly close to negotiating the end of a three-year trade dispute over beer. As a result, the price of imported U.S. beer is likely to drop in Ontario and remain low in nine other provinces. Ontario would be allowed to preserve its controversial environmental charge on beer cans, but would drop its minimum beer price and allow U.S. beer to be distributed through its Brewers Retail outlets.
SOARING FOREIGN INVESTMENT
Foreign investors have bought $4.3 billion worth of Canadian stocks in 1993, dwarfing the net $1 billion in equities non-residents purchased in all of 1992. That trend has helped to push up the Toronto Stock Exchange 300 composite index by almost 16 per cent since January.
RAILING AGAINST DELAYS
Bombardier Inc. of Montreal has filed a $746-million claim against the builders of the English Channel tunnel to compensate for increased costs due to alleged delays and requests for modifications. Under a $836-million contract, Bombardier plants are manufacturing 254 double-deck and single-deck rail cars to transport cars and buses through the tunnel, which is not expected to be completed until 1995.
Canadian shoppers continue to keep a tight rein on their spending. Statistics Canada said that retail sales totalled $16.1 billion in May, the same level as the previous month, and 5.5 per cent higher than May, 1992. Sales stalled after a one-per-cent increase in April, which followed two monthly declines. Meanwhile, one of Canada’s largest retailers, Eaton’s, announced that it will lay off an undetermined number of its 30,000 employees at 92 stores across Canada. The stores are privately owned by the Eaton family and do not release public financial statements.
EARLY TROUBLE SIGNS
The federal deficit for the first two months of the fiscal year, April and May, is $8.3 billion, up by $3.6 billion from the same period in 1992. Overall, revenues were down by $3.9 billion to $14.9 billion over the same two-month period last year. The finance department cautioned that the numbers can fluctuate early in the fiscal year, and it takes at least four months of data to get a real assessment of how the year is going.
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