Canadian confidence rising says EDC

Confidence among Canadian exporters is rising, according to a new survey report issued by Canada’s export credit agency Export Development Canada (EDC).

The biannual survey, entitled the Trade Confidence Index, analyses Canadian exporters’ expectations in the coming six months in five separate categories including trade opportunities, export sales, domestic sales and domestic and global conditions.

The survey shows that half of Canadian exporters believe that business opportunities will increase over the next six months, with many mentioning the large growth potential offered by emerging markets.

Only 10% of respondents believe that their exports will decrease.

However, the optimism could be misleading, says Peter Hall, chief economist at EDC: “The increase in confidence is good to see, but it masks a growing unease with international conditions. The only reason Canadian exporters are feeling better is because they have a solid domestic market to fall back on. Confidence in international conditions actually fell during the spring.”

The survey results agree with Hall’s interpretation, showing that over half of Canadian exporters believed that domestic sales would increase over the next half year, up from 45% compared to October 2009.

Hall continues: “Interestingly, 25% of exporters are telling us that expansion into new markets is an important reason for optimism, outpacing their proportion of overall trade. If this trend continues and extends into practical market diversification, overall trade growth will rise to a higher plane.”