2016 was a year of challenge, but 2017 looks like a year of opportunity for Alberta’s exporters, according to Export Development Canada’s semi-annual Global Export Forecast.
After a double-digit decline in 2016, Alberta’s energy engine is not only ramping up again, it’s also fuelling Canada’s export recovery this year. The rebound in the energy sector, combined with modest growth in its agri-food exports, will boost the province’s global growth by 19 per cent – the best in the country.
“Despite multiple attempts at diversification, Alberta’s export scene is still dominated by energy,” said Peter Hall, EDC’s Chief Economist. “The energy rebound in Alberta is substantial enough to lift national export growth this year. Alberta is coming back from the brink.”
Last year, the province’s total exports declined by almost 15 per cent as plunging energy prices, combined with the effects of the Fort McMurray fire, carved 17 per cent out of energy exports. This year, the energy recovery will push national export growth to 6 per cent.
The agri-food sector will post modest growth of 2 per cent. However, changing economic and demographic trends around the world suggest much better times ahead for Alberta’s second-largest export sector.
“While the United States continues to be the top destination for the province’s exports, Alberta producers can seize growing potential in large emerging markets, in particular China and India,” added Mr. Hall. “Population growth and rising incomes in these countries mean that every year there are millions of new, middle class consumers looking for high-quality Alberta agri-food products.”
Despite the good news, Canadian exporters are facing a popular backlash against globalization that is threatening to dismantle the architecture of modern trade. Even so, EDC is convinced that the basic architecture will remain intact, and that trade business and foreign investments will continue to gain steam in the short term.
“Last year welcomed a wave of trade policy paralysis,” said Mr. Hall. “Is this the beginning of the end for globalization? Not likely – the cost is massive, and everyone ends up paying more. Swing a wrecking ball in a densely-built neighborhood, and it takes out more than one building,” added Mr. Hall.
Peter Hall is discussing export prospects for Alberta as well as the nation May 11th, at the Chateau Lacombe Hotel in Edmonton. The event, in partnership with Canadian Manufacturers & Exporters (CME), 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. For more information, visit EDC’s Global Export Forecast to learn more.
