Despite all the protectionist noises coming from the White House these days, Canada’s government-owned export bank doesn’t seem worried.
In fact, Export Development Canada’s spring 2017 forecast sees Canadian exports rise six per cent this year — twice the pace it predicted just six months ago in its fall forecast.
U.S. President Donald Trump addresses a joint news conference with Canadian Prime Minister Justin Trudeau at the White House in Washington, D.C., Feb. 13, 2017. A new forecast from Export Development Canada doesn't see Trump's protectionist rhetoric harming Canada's export outlook. (Photo: Reuters/Kevin Lamarque)
Even the Trump administration’s battle with Canadian lumber won’t stop the sector from expanding its exports this year, EDC predicts. It downgraded its forecast for forestry exports, but still sees growth of five per cent.
“However, the looming prospect of the U.S. imposing countervailing duties on softwood lumber exports increases the uncertainty for the forestry industry,” the report noted.
The oil-exporting provinces will lead the way on exports, EDC predicts. After declining 14.7 per cent in 2016, Alberta’s exports — led by a recovery in energy prices — will jump 19 per cent, the largest increase of any province.
A bounce-back in commodity prices will also send Canadian metals exports up 11 per cent, EDC predicted.
The bank sees another four-per-cent increase in exports in 2018, led by a growing aerospace sector.
That’s a far cry from its forecast just six months earlier, when it saw “significant contractions” in energy and metals, and warned that “growth remains elusive.”
That report warned public discontent has “has thrust the world into an existential debate” about the future of globalization, as evidenced by the Brexit vote and the political rise of Donald Trump.
Canadian lumber exports are forecast to grow 5 per cent this year, although EDC warns that Trump's tariffs increase uncertainty for the lumber industry. (Photo: Getty Images)
But its latest outlook strikes a more optimistic tone — perhaps on the expectation that U.S. President Donald Trump will face severe headwinds to his protectionist agenda.
"Is this the beginning of the end for globalization? That's highly unlikely — the cost is massive, and everyone gets a bill in the mail," said Peter G. Hall, EDC's chief economist, in a statement. "Remember, a wrecking ball doesn't only swing one way — it swings back. ... The message that EDC has for Canadian companies is to stay in the game and win the contracts that others have been frightened away from."
EDC predicts the world economy will grow 3.5 per cent this year, and will accelerate to 3.8 per cent in 2018.
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