U.S. recovery to spur growth in Quebec exports through 2014
MONTREAL, May 8, 2013 /CNW/ - The ongoing recovery in the U.S. that is forecast to pick up steam in 2013 will drive Quebec's exports to grow by 8 per cent in 2013 and a further 6 per cent in 2014, according to Export Development Canada's (EDC) Global Export Forecast.
EDC's Chief Economist, Peter Hall, was in Montreal today to deliver his provincial export forecast to a breakfast audience at the World Trade Centre.
"The U.S. buys two-thirds of all Quebec exports, and with their recovery gaining momentum through 2013, we're looking at a solid export increase after a few years of low export growth," Mr. Hall said. "Also on the plus side are production increases in the mining industry and higher aerospace sales. All told, Quebec's export sales are heading north, with help from our southern neighbors."
Mr. Hall's forecast for the U.S. economy is predicated upon the view that there is significant private sector momentum despite the fiscal drag. The housing market has finally returned to balance as the excesses of the last cycle have been soaked up over the past few years and now prices have firmed and housing starts are soaring.
"U.S. consumers are also spending, particularly on larger goods, and businesses, who are now running out of productive capacity, are beginning to spend the mountain of cash that has built up," said Mr. Hall.
The industrial goods sector, which includes ores, minerals and metals exports, accounts for approximately 38 per cent of the province's exports. EDC's forecast for this sector calls for export growth of 7 and 2 per cent in 2013 and 2014, respectively.
"Despite regulatory headwinds in the form of changes to the Quebec mining regime, the metals and mining industry remains a key contributor to Quebec's overall export performance. Exports are poised to rebound following a disappointing 2012 that was caused, in part, by sluggish prices. Looking forward, both demand and prices will be up in 2013."
The transportation sector is another important contributor to Quebec's export picture, contributing approximately 12 per cent of the province's total. EDC's forecast predicts the sector will grow by 13 per cent this year and 16 per cent in 2014.
"Aerospace exports will be the main driver in Quebec's transportation story," said Mr. Hall. "The ongoing global recovery and rapid growth in air travel in emerging markets is particularly well suited to Bombardier's product mix. The environment for business jets is also beginning to stabilize, as are commercial aircraft orders. The CSeries will be coming online to boost the sector's exports sales even further in 2014."
Quebec's exports to emerging markets accounted for 13 per cent of the province's total in 2012, up from 9 per cent in 2008. China is the second largest export destination (after the US), accounting for 4% of Quebec's exports. Industrial goods represent make up a large share of exports to emerging markets.
Nationally, Canadian merchandise exports are forecast to rise 8.6 per cent in 2013 and 5 per cent in 2013, while economic growth (GDP) is expected to rise 2.2 per cent this year and 1.9 next year. EDC is forecasting global growth of 3.6 per cent in 2013 and 4.2 per cent in 2014.
EDC's semi-annual Global Export Forecast addresses the latest global export conditions including market- and sector-specific insights to help Canadian exporting companies grow their international and minimize risk. It also analyzes a range of risks for which exporters should be prepared. Read EDC's Global Export Forecast.
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 7,400 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