U.S. housing boom to power B.C. exports to 10 per cent gain in 2013: EDC forecast
VANCOUVER, Nov. 15, 2012 /CNW/ - Export Development Canada's (EDC) forecast for British Columbia's export growth calls for a strong rebound of 10 per cent in 2013, after a slight decline of 3 per cent this year.
"Buckle up, because B.C. exports are on a roll thanks to the imminent U.S. recovery and steady growth in the Chinese market next year," said Peter Hall, Chief Economist, EDC. "Export growth in 2013 will be widespread, but explosive growth will give the forestry sector a commanding lead."
B.C's forestry sector accounts for more than 30 per cent of the province's total exports, and is forecast to see 18 per cent growth next year, following a flat 2012 performance.
"The U.S. housing market is on the move for the first time since 2006," said Hall. "Today's 35 per cent growth is just the beginning, as U.S. housing starts are forecast to rise by an additional 40 per cent in 2013. This rebound is the real thing, and will give a significant boost to the province's sawmills next year and beyond. And there's more: Chinese demand will continue to add to exports of lumber and pulp."
B.C. led the country in growth of exports to emerging markets as a share of its total, which grew from 13 per cent in 2007 to 24 per cent in 2011. In contrast, the global recession had a substantial impact upon B.C.'s export sector, with the number of exporters declining from 5,543 in 1999 to 5,077 in 2010.
"B.C. has about 10 per cent fewer exporters than a decade ago, but its share of exports to emerging markets jumped by 11 per cent in the past five years, suggesting that B.C. exporters are diversifying more on a company basis than any other province," said Hall.
The energy sector generates 31 per cent of the province's total exports. EDC expects energy exports to grow by 5 per cent next year after declining by 7 per cent this year. "The long-term potential for the province's energy sector remains bright, and the current level of investment should keep production increasing well into the future," said Hall.
The industrial goods sector is also important to B.C.'s export picture, making up 20 per cent of the province's total exports. The sector will see growth of 6 per cent growth next year after a disappointing 9 per cent decline this year. "With copper, gold and molybdenum capacity being added to mining output, exports of industrial goods are expected to increase next year," said Hall. "Longer-term projects will also boost the metals sector beyond 2014."
EDC's semi-annual Global Export Forecast addresses the latest global export conditions including perspectives on interest rates, exchange rates as well as export strategies to help Canadian companies minimize risk. It also analyzes a range of risks for which exporters should be prepared. The forecast is available on EDC's website at: http://www.edc.ca/gef.
EDC is Canada's export credit agency, offering innovative commercial solutions to help Canadian exporters and investors expand their international business. EDC's knowledge and partnerships are used by more than 7,700 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining and a recognized leader in financial reporting and economic analysis.
SOURCE Export Development Canada