(VANCOUVER) – May 9, 2007 – British Columbia's international exports are forecast to level off in 2007 before rising a modest 2 per cent in 2008, according to a provincial export outlook by Export Development Canada (EDC). International exports from British Columbia declined by 2.2 per cent in 2006 after growing at an impressive rate of 10 per cent in both 2004 and 2005.
"B.C.'s exports will continue to feel pressure in 2007 before a slight upturn in 2008," said Stephen Poloz, Senior Vice-President of Corporate Affairs and Chief Economist. "B.C.'s largest export sector, forestry, is experiencing declines in building products and paper, but much of 2008's expected upturn will be driven by a strong performance in pulp."
The forestry sector accounts for 40 per cent of the province's exports and is expected to continue declining in 2007 (-3 per cent) as a result of continued weakness in US housing. The pine beetle infestation continues to translate into very aggressive harvests that are contributing to increased inventories, impacting the province's exports for the next couple of years. Better prospects for the sector create a more positive outlook for 2008, with overall growth forecast to rise to 4 per cent. Much of the expected upturn in 2008 comes from pulp and paper as demand for lumber and wood products will remain sluggish.
It is expected that energy exports, accounting for 19 per cent of the province's export value, will level off in 2007 before picking up in 2008, which comes after a substantial decrease of 19 per cent in 2006. EDC forecasts a slight decline of 1 per cent in the province's energy exports in 2007, followed by a small gain of 4 per cent in 2008. This positive outlook is partly due to the introduction of new coal mines set to open in 2008, increasing B.C.'s production capacity. Natural gas is also expected to see a stronger pricing environment through the next couple of years.
Nationally, Canadian export volumes are forecast to decline by 1 per cent in 2007 before rising by a modest 1 per cent in 2008. Canadian economic growth is forecast to remain stable at 2.3 per cent in 2007 and 2.9 per cent in 2008. Internationally, EDC is forecasting 4.5 per cent global economic growth in 2007 and 4.6 per cent growth in 2008. EDC's Global Export Forecast is available at http://www.edc.ca/gef.
EDC is Canada's export credit agency, offering innovative commercial solutions to help Canadian exporters and investors expand their international business. EDC's knowledge and partnerships are used by 7,000 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining and is a recognized leader in financial reporting, economic analysis and has been named one of Canada's Top 100 Employers for six consecutive years.
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Media contact: Phil Taylor Public Affairs, Export Development Canada Phone: (613) 291-1276 E-mail: ptaylor@edc.ca
