Canadian exporter confidence has bounced back from one of the lowest points on record last fall, according to a new survey released in early June by Export Development Canada (EDC).
EDC's Trade Confidence Index (TCI) is a semi-annual survey that examines the attitudes of Canadian exporters as they forecast the business environment over the next six months through five index elements: trade opportunities, export sales, domestic sales, and both domestic and global economic conditions. The overall TCI score moved up to 75.9, up from 67 in the fall of 2011 one of the lowest points on record. The 75.9 score is consistent with normal economic conditions.
"It's a relief to see that the Index has recovered from last fall's drubbing,' said EDC's Chief Economist, Peter Hall. "At the time, the plunge looked like an overreaction to temporary global slowing. Exporters are now seeing a return of growth.
Further, the new data shows that a more than 60 per cent of Canadian manufacturers believe that their export sales will grow over the next two quarters and more than half plan to expand into new markets in the next two years.
“We are seeing stronger market diversification in Canada's trade numbers, but what we're hearing from exporters suggests that it's a trend that's about to pick up steam,” said Hall. "More than a third of exporters reported increasing US orders, a trend that is expected to continue through 2012. Interestingly, with all the challenges Europe is facing, exporters are seeing more growth in the UK, Germany and France, and they expect it to continue.'
Hall notes that almost half of Canadian exporters are now targeting BRICM markets (Brazil, Russia, India, China and Mexico) as export destinations, an increase by five percentage points in the past six months alone. Some 56 per cent of Canadian exporters plan to expand into a new market within the next two years. By comparison, one in three Canadian exporters entered into new markets over the past two years.
The survey was conducted in April 2012. A total of 1,000 Canadian businesses from a variety of industries participated.