(MONCTON) – November 14, 2008 – New Brunswick's international export growth is expected to lead the country with 8 per cent growth in 2009 after surging 26 per cent in 2008, according to a provincial export outlook by Export Development Canada (EDC).
'Huge declines in oil prices will have a marked impact on the province's exports given the energy sector's leading role in New Brunswick,' said Peter Hall, Vice-President and Chief Economist. 'However, we expect that new export activity and a significantly lower Canadian dollar will help to preserve overall growth in 2009. Stresses in the forestry and metal mining industries will persist through 2009, a direct result of the spreading global economic slowdown.'
The energy sector dominates New Brunswick's total international exports, and is expected grow by 45 per cent in 2008 on the continued strength of U.S. gasoline prices. Looking forward, operations at the LNG terminal in Saint John will commence early in 2009 and natural gas exports will also benefit from additional capacity at the McCully natural gas field. Overall, energy exports will increase 9 cent in 2009 despite falling energy prices as the LNG plant adds an estimated $2.5 billion to exports, and as electricity production stabilizes.
Conditions remain challenging in the forestry sector, which accounts for 16.5 per cent of the province's exports. After declining 21 per cent in 2008, forestry exports are expected to expand by 8 per cent in 2009. Wood product exports will see limited gains in 2009, as U.S. construction activity remains low. Paper exports dropped sharply in 2008, as mill closures in Miramichi and Dalhousie largely offset generally higher prices. After the initial impact of these closures, paper exports will expand again in 2009, but from a much lower base. Pulp exports expanded in 2008 thanks to tight global markets and capacity expansion in Edmundston (Fraser Papers), Atholville (AV Cell) and Nackawic (AV Nackawic) mills. However, weakening supply and demand fundamentals in the pulp sector will see export growth deteriorate through 2009.
Canadian exports are forecast to grow by 2 per cent in 2008 before declining 1 per cent in 2009. The Canadian economy is expected to grow by 0.9 per cent in 2008 with a slight upturn to 1.4 per cent in 2009. Internationally, EDC is forecasting a 3.8 per cent growth rate in 2008 and 3.3 per cent 2009. 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 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 eight consecutive years.
Media contacts:
Phil Taylor
Export Development Canada
Tel: (613) 598 2904
BlackBerry: ptaylor@edc.ca
