Trade deficit meaning and importance in economy [Video]

In a post on Truth Social early Wednesday, Donald Trump claimed his country is financially supporting its northern neighbour.

The U.S. president-elect wrote that “we subsidize Canada to the tune of $100,000,000 a year” — an apparent reference to a previous claim about a $100-billion trade gap — and said the imbalance “makes no sense.”

“Many Canadians want Canada to become the 51st State,” he said in the post, made at 3:23 a.m. EST.

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In fact, the U.S. trade deficit sat at US$41 billion in 2023, according to figures from the U.S. Bureau of Economic Analysis.

What is a trade deficit?

On the global stage, countries export some goods and services while importing others. A trade deficit occurs when the dollar value of a country’s imports is more than its exports.

Each country has an overall global trade balance, as …