An energy rebound combined with a surge in ores and metals is fuelling Newfoundland and Labrador's substantive export recovery this year, according to Export Development Canada (EDC), Canada's trade financing agency.
"Newfoundland and Labrador will be a Canadian export powerhouse this year and next," said Peter Hall, EDC Chief Economist and Vice President. "After a challenging 2016, the province's top export sectors are storming back to growth, thanks to increased production, robust world demand and higher prices."
According to EDC's semi-annual Global Export Forecast, businesses in Newfoundland and Labrador are expected to post the second-best performance in the nation with a surge of 13 per cent in 2017. This is positive news after weathering a double-digit reduction in exports last year. Next year's outlook is even brighter, as the province's exports will lead Canada's international growth with a 17 percent increase.
Energy, which accounts for approximately two-thirds of all exports, is leading the comeback with an 18 percent increase. An 11 per cent surge in ores and metals, combined with modest increase in agri-food is also helping write the province's good news story.
Despite upbeat prospects, local exporters are facing unprecedented risk in global markets due to the popular international backlash that is threatening globalization. Even so, EDC is convinced that the architecture of international trade will largely remain intact, enabling exporters to continue powering ahead in the short term.
"Last year, the Western world was hit with a wave of trade policy paralysis," said Mr. Hall. "Globalization is at risk, but it's not likely to unravel - the cost would be massive, and everyone would be affected. A wrecking ball doesn't just swing one way - it swings back, and in a densely-built neighborhood like globalization, there's a lot of widespread damage."
Mr. Hall is discussing world economic prospects and the effect on Newfound and Labrador exporters on May 18th at the Delta St. John's. The event, in partnership with Newfoundland and Labrador Environmental Industry Association, is part of a month-long, 13-location cross-country Let's Talk Exports tour. The initiative highlights export prospects for Canadian companies around the globe in addition to providing insights into the health of the global economy and how it will impact Canadian exporters.