Exporter Confidence Now Higher Than 2003-2006 Boom Years: EDC Survey

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Government of Canada Jun 23, 2014

Canadian companies that sell internationally are more confident about business prospects now than they were during the global economic boom period between 2003 and 2006, according to the semi-annual Trade Confidence Index by Export Development Canada (EDC).

EDC is Canada’s leading provider of financing, insurance and bonding for Canadian companies that sell into foreign markets. EDC’s Trade Confidence Index (TCI) measures how Canadian exporters and investors are feeling about their business opportunities in the next six months.

The overall TCI score, a summary of the state of Canadian exporter confidence, moved up 1.8 points to 77.2, its third consecutive increase.

A clear majority of exporters believe that their international sales will increase over the next six months.

“Canadian exporters are far more bullish on the US economy compared with six months ago. Of those that believe that the global economy is on the upswing, almost one third believe that the US revival will be the primary catalyst in the coming six months,” said Peter Hall, Chief Economist, EDC. “That’s up from just three per cent last fall.”

“Exporters are also much more upbeat about economic improvement in Europe,” said Hall. “A huge driver of improved business opportunities is the fall of the Canadian dollar. Few were upbeat about a boost from the loonie six months ago, but of those that believed that business would be picking up in the next six months, 37 per cent think that our dollar will be the primary boost. That’s an impressive change.”

The following is a summary of some top line survey results:

• A growing majority of respondents expect export sales to increase in the coming six months. The proportion of those expecting higher sales edged up to 61 per cent from 55 per cent in the fall, the strongest positive reading among the five TCI elements.
• Half of all respondents said they plan to export to new countries over the next two years, with 34 per cent having already exported to new countries in the past two years.
• A lower Canadian dollar is one of the key reasons that exporters are increasingly positive about international business opportunities. Thirty-seven per cent of those with a positive outlook pointed to the softening Canadian dollar as a prime reason for their optimism, and 58 per cent of all respondents felt that the lower dollar had a positive effect on their export sales.
• The U.S., China, Australia and the U.K. top the list of markets that Canadian companies have started selling to in the past two years.

The TCI survey was conducted between March 24 and April 4, 2014. A total of 1,000 Canadian businesses participated, and the TCI was calculated on a total of 752 respondents.

For more information about EDC and the Trade Confidence Index, visit Trade Confidence Index.

EDC is Canada’s export credit agency, providing financing and insurance solutions locally and around the world to help Canadian companies of any size respond to international business opportunities. As a profitable Crown corporation that operates on commercial principles, EDC works together with private- and public- sector financial institutions to create greater capacity for Canadian companies to engage in trade and investment.