Protectionism and global economy fears send Canadian exporters’ trade confidence to lowest level in 8 years.
Trade confidence among Canadian exporters fell to its lowest level in nearly a decade, Canada’s export credit agency said yesterday, as businesses wrestle with protectionist policies and fret about the global economy.
In its biannual survey of 1,000 Canadian exporters, Export Development Canada (EDC) said its trade confidence index fell to 69.3%—the lowest level since 2012 and 6% below the survey’s historical average.
Thirty per cent of exporters polled said protectionism was affecting their global strategies, while nearly 90% said they expected protectionism to either stay the same or increase in 2020, the survey found.
“Trade barriers are now the No. 1 challenge, cited as a bigger problem than perennial issues, like finding skilled talent, logistics and financing,” said Stephen Tapp, EDC’s deputy chief economist.
Meanwhile, 34% of respondents said they had been negatively affected by the US-China trade dispute.
The national telephone survey of small, medium and large-sized companies was conducted between Nov. 18 and Dec. 15, before the United States and China agreed to an initial Phase 1 trade deal in mid-January.
Closer to home, more than three-quarters of respondents told EDC they expected the United States-Canada-Mexico Agreement (USMCA) to be ratified. Only 16% of respondents expressed a negative assessment of the deal, down from 34% in the previous survey, EDC said.
Canada, which sends about 75% of its goods to the United States, is the only one of the three signatories to not have formally blessed the USMCA deal. Prime Minister Justin Trudeau, whose minority Liberal government no longer controls the House of Commons, has urged parliament to ratify the deal quickly.
Tapp said both the initial Phase 1 trade deal between China and the United States as well as the expected ratification of the USMCA “will reduce trade uncertainty and provide a welcome reprieve for Canadian exporters.”