Exports lost a little confidence in fall 2010
Canadian exporters are less confident about their near-term prospects than they were last spring, according to Export Development Canada’s Trade Confidence Index.
OTTAWA: Canadian exporters are less confident about their near-term prospects than they were last spring, according to Export Development Canada’s (EDC’s) Trade Confidence Index (TCI).
The semi-annual index slipped from 78.8 in the spring to 74.1 in the fall of 2010. EDC said although it’s a setback, this level “is consistent with positive growth in trade.” But it’s also a contrast to a 1.4-point increase in the spring and an 8.9-point rise in fall 2009. The lowest score (61) occurred in fall 2008.
Peter Hall, chief economist of the Ottawa-based export credit agency, said optimism cooled at the tail end of 2010 as perceptions of Canada’s economy weakened and doubts grew about the global recovery.
The TCI survey showed a decline in domestic sales, export sales, domestic economic conditions, global economic conditions and international business opportunities. However, Hall said exporters were “relatively chipper” about global sales prospects.
“Although slightly down from the last survey, 49% of exporters expected increased near-term sales. Put these together with those expecting static sales performance and the number soared to 89%. Most respondents cited growing demand for products and expansion into new markets as reasons for their sales optimism.”
Exports to BRIC (Brazil, Russia, India, China) and Mexico markets jumped to 44% from 40% in the spring. Last spring 19% of exporters expected BRICM markets to contribute the most to export sales. By fall the figure jumped to 23%.
The survey’s biggest change was in perceptions of economic conditions. Exporters registered an identical drop in confidence for both global and domestic conditions from over 30% to 15%.
Confidence was also down in each industry sector. The biggest drops occurred in transportation (7.4) and non-mineral resources (7.1).
By region, the biggest declines came from Atlantic (6.4) and Western (5.3) Canada. Ontario dropped by 4.3 and Quebec by 4.6.
Click here for a pdf of the report.