(MONTREAL) – May 13, 2008 – Slow international growth and the high Canadian dollar will drag Quebec's exports down by a further 4.5 per cent in 2008 and keep exports flat in 2009, according to a Provincial Export Forecast released today by Export Development Canada (EDC). Quebec's exports declined by 2.8 percent in 2007.
"Quebec's export recession will deepen in 2008," said Peter Hall, Vice-President of Economics and Deputy Chief Economist. "In contrast to 2007, few industries will escape the downturn this year. And in most cases, the outlook for 2009 is weak".
The aerospace industry is expected to perform fairly well this year and next, despite a strong Canadian dollar, higher input costs and growing global competition. At the same time, the industry is being challenged by a need to reduce costs and improve fuel efficiencies. Demand for business jets is expected to ease in tandem with slowing corporate profit growth. Manufacturers of parts and equipment that supply the U.S. defense sector will see their sales mostly flat. The best business opportunities for aerospace exporters will be in the higher-fuel-efficient turboprops segment. Strong global demand for helicopters will also help to support aerospace exports. Overall, exports of aircrafts and parts are forecast to increase 4 per cent in 2008 and a further 4 per cent in 2009.
The forestry sector, which accounts for 14.7 per cent of Quebec's total exports, will decline by a further 3 per cent in 2008 before stabilizing demand together with a boost from a weaker Canadian dollar is expected to lead to growth of 8 per cent in 2009. Weaker newsprint consumption is anticipated this year, as on-line media continue to gain U.S. market share and cuts are made to advertising paper demand. Although higher paper prices are forecast, we expect reduced production, lowering exports by 1 per cent in 2008. In contrast.. pulp demand is expected to remain very strong in 2008, due to growing paper and paperboard capacity in emerging markets. Stronger pricing and a depreciating Canadian dollar should help pulp exports to increase 11 per cent in 2008 and another 8 per cent in 2009. The collapse in US housing construction will result in another difficult year for lumber and wood product producers.
Canadian exports are forecast to decline by 2 per cent in 2008 before posting 2 per cent growth in 2009. Nationally, economic growth is forecast to decline to 1 per cent in 2008 with a slight upturn to 2.3 per cent in 2009. Internationally, EDC is forecasting a 3.8 per cent growth rate in 2008 and 2009. EDC's Global Export Forecast is available at http://www.edc.ca/english/docs/GEF_e.pdf (PDF, 2.27 MB)
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 nearly 7,000 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining, is a recognized leader in financial reporting and economic analysis, and has been named one of Canada's Top 100 Employers for seven consecutive years.
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B-roll of Peter Hall's thoughts on Quebec's exports and the forecast for aerospace and forestry sectors are available at the FTP site provided below. Additional b-roll for forecasts of the Canadian dollar, the Canadian economy, price of oil and other related topics are also available.
FTP site: ftp://relay1.edc.ca
Password: gef2008
The preview folder is for quick viewing. Please use the download folder for higher grade files suitable for television and radio broadcast use.
Media contact:
Phil Taylor
Export Development Canada
Tel: (613) 291-1276
Blackberry: ptaylor@edc.ca
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