India a big opportunity for Canadian companies: EDC head
Growing middle class amongst emerging markets is propelling demand for "value-added'' goods.
MONTREAL — The head of Export Development Canada says Canadian companies need to build links with emerging markets like India even though the US economic recovery and a lower Canadian dollar are boosting exports to the US.
Agency CEO Benoit Daignault says it would be foolish to ignore Canada’s largest trading partner in light of growing demand from the auto and housing sectors.
But Daignault says Canadian firms must hedge their bets by creating links with high-growth markets elsewhere in the world.
He says India could offer major opportunities if Prime Minister Narendra Modi, who is currently visiting Canada, can rein in his country’s bureaucracy and red tape.
And he says Canada is well-positioned to take advantage of business opportunities in India because of the strong ties between the residents of the two countries.
Other high-growth markets include other parts of Asia, Mexico, South America, Africa and the Middle East, where a growing middle class is propelling demand for “value-added” goods and services in the fields of education, food, health-care, the environment and financial services.
Meanwhile, urbanization is advancing large infrastructure projects like ports, airports and roads.
Nearly three-quarters of Canadian exports are currently directed to the US, compared with just 4% to China.
However, Canadian exports to emerging markets have surged to 13% from just 5% in 2000.
Still, only 4% of Canadian companies sell abroad. A recent Deloitte study found that exporters have 30% higher productivity, 70% more revenue per employee and three-year returns that are triple those of non-exporters.
© 2015 The Canadian Press