Uncertainty is never greeted with enthusiasm by financiers of the world, and one could not have expected it to be any different about the 5th greatest economy leaving the European Union and its huge, free and well regulated market. Especially when no roadmap is drawn for the journey out and article 50 of the 2007 Lisbon Treaty serves as the only compass…
When it comes to Canada however, it is worth noting that Brexit's fallouts should be felt more as a ricochet effect than a direct blow. This is due to the relative modesty of its economic ties with the United Kingdom and the overwhelming influence of the United States' clientele and investments over the Canadian market. For instance, should the US dollar serve too long as a refuge currency for investors fleeing the pound sterling, a slowing US economy would result in fewer imports of Canadian merchandises and fewer American investments abroad. Further harm could also come from the West: a weaker European Union could cause turmoil in Asia, which would also hurt US enterprises.
Some direct effect will obviously be felt north of the border too, if only because Canada spent years negotiating a trade agreement with the European Union, the CETA, which is currently under review. Starting over for the sole market of the United Kingdom could result in the loss of numerous commercial opportunities, as such negotiations are prone to drag over quite long period of times.
Many more developments are thus needed before one can properly understand and anticipate the actual effects of Brexit on Canada. While we hold our breath, this post is an attempt at highlight how much these effects will depend on the resistance of the United States' economy by analyzing the most recent data available on Canadian exports and foreign direct investments.
Canadian exports to the United Kingdom
In 2015, Canada's merchandises exports to the European Union represented 7.20% of the global amount. 42.29% of these merchandises were imported by the United Kingdom (for an amount of C$15,951.7 million)… which accounts for only 3.04% of Canada's exports that year. In nominal terms, these volumes have decreased slightly in recent years: Canada exported C$18,791.8 million worth of merchandise to the Kingdom in 2011.
Over the same five year period however (2011-15), Canada's exports have grown by 17.32%, from C$446,706.8 million to C$524,068.2 million. China's share increased by 20.3%, but it remains the destination for a meek 3.86% of all Canadian merchandises exported in 2015 (for a value of C$20,222.6 million). The growth in exportation was actually driven by the usual suspects: the Unites States imported 22.25% more of Canada's merchandises in 2015 than in 2011, going from C$328,975.4 million to C$402,177.1 million. With a 76.74% share, they remain by far the largest purchaser of Canadian goods abroad.
A focus on the exportation of Canadian services results in a similar picture: although the United Kingdom was the second importer of such services in 2014, it accounted for a mere 5.54% of the total, far behind the United States' 55%.
British investments into Canada
While the United Kingdom exerts more influence on Canada's economy as an investor than an importer, that influence remains modest when put in perspective with that of American investors
A good measure of foreign direct investments (NYSE:FDI) which has been used for years by the United Nation's Conference on Trade and Development (UNCTAD) is referred to as "FDI Stocks". That measure is defined by the UNCTAD as the value of the share of a corporation's capital and reserves (including retained profits) attributable to the parent enterprise (this is equal to total assets minus total liabilities), plus the net indebtedness of the associate or subsidiary to the parent firm.
According to Statistics Canada, the United Kingdom was the fourth foreign investor into Canada by measure of FDI Stocks in 2015. Yet it only accounted for 4.46% of the total FDI Stocks that year. It was certainly more than China's 2.68%, but less than Netherland's 11.59% or even Luxembourg's 7.92% (the Great Duchy filling its part as a launching pad for other foreign investors). Unsurprisingly, the United States dominated that ranking with 50.45% of all FDI Stocks into Canada. Conversely, the United Kingdom is the second beneficiary of Canadian's outwards FDI Stocks, receiving 9.25% of same in 2015, far below the United States' 44.62% share.
 Comprehensive Economic and Trade Agreement
 According to Statistics Canada : http://www.statcan.gc.ca/tables-tableaux/sum-som/l02/cst01/gblec02a-fra.htm
 Still according to Statistics Canada: http://www.international.gc.ca/economist-economiste/statistics-statistiques/cits-tisc.aspx?lang=eng )