OTTAWA – The Canadian government’s lending agency for exporters says there’s a light at the end of the tunnel for one of the economy’s weakest links.
Export Development Canada forecasts shipments will rise by 5.3 per cent in 2014 following a gain of 4.4 per cent this year, which will be below expectations.
The growth is unlikely be enough to reverse 20-months of trade deficits stretching to early 2011, but EDC chief economist Peter Hall believes a turning point for Canadian exporters is within sight.
Hall says the world economy, and particularly the United States, are in the early stages of a new growth cycle that should boost demand for Canadian products.
He predicts global growth will approach four per cent in 2014, from about three per cent the previous two years, while the U.S. will grow by 3.0 per cent, up from 1.7 per cent.
“Conditions are already ripe for decent Canadian export growth,” Hall says. “The loonie is weakening, our dominant export market is leading the global growth story, key leading exports are already surging and demand for resources remains strong.”
Bank of Canada governor Stephen Poloz, who formerly headed the EDC, has also pinned his hopes for the Canadian economy on a recovery of the export sector arguing that, once it occurs, it will boost business confidence and investments in machinery and equipment.
For next year, Hall says the forestry sector, aircraft and machinery industries will fare well.