GHY Tradelines

(International Trade Administration)

U.S. Acting Secretary of Commerce Rebecca Blank today honored 57 U.S. companies and organizations that export goods or services at the 2013 President’s “E” Awards ceremony. This year marks the 51st anniversary of the “E” Awards, which recognize significant contributions to increasing American exports. Today’s set of honorees, many of which are small and medium-sized enterprises, was the largest group in three decades to receive this distinguished award.

“These companies truly represent the spirit of American business and entrepreneurship – bringing some of the best and most innovative products and services to the global marketplace with the sought after ‘Made in the USA’ label,” said Acting Secretary Blank. “Exports continue to be the engine of our economy, supporting nearly 10 million good, high-wage jobs in cities and communities across the country. Furthermore, the success of these exporters reflects historic progress in U.S. export growth. In 2012, U.S. exports hit an all-time high of $2.2 trillion, with record levels of sales to more than 70 trading partners, including major emerging markets and 11 free trade agreement (FTA) partners.” Read more here.
 

(CBC News)

Bank of Canada governor Mark Carney is leaving Canada with some parting advice – seize the country’s natural advantages.

The central banker said Tuesday in his last scheduled public appearance before departing for the Bank of England next month that Canada can coast and wait out the decade-long damage-repair process in the rest of the G7 economies, or build on its strengths for the emerging new global economy.

Carney said the Canadian government is correct in seeking out new trade deals, particularly in emerging economies, because they represent one half of the world’s imports growth and also are essential to securing a position in global supply chains.

Export growth needed
The speech to the Montreal Board of Trade, notes of which were released in Ottawa, read somewhat like a valedictory address in which the banker was full of praise for the country’s achievements and endowments, while also urging it on to future successes.

Carney broke no new ground in the speech as he has long stressed the need to transition Canada’s exports-based industries from reliance on slow-growing economies like the U.S. and Europe to fast-growing markets in China and Asia in general. But the advice took on added currency given it was likely the last time he will pronounce generally on the Canadian condition for at least the next five years, the term of his posting in London. Read more here.
 

(Peter Hall – Huffington Post)

International trade will be a key growth driver for the Canadian economy this year and next. However, the distribution of export growth in Canada’s provinces is anything but even. Some are leading the charge, while others are steady at the national pace. Others are lagging behind, some quite seriously. What are the key factors influencing the different growth patterns?

On top of the heap are British Columbia and Nova Scotia. Surging forestry exports are a big reason that B.C. will see 12% growth this year and a further 11% in 2014. Wood shipments to the reviving US market will add to the robust increase in exports to China. BC will also get a solid boost from mineral exports, thanks to new mining production. Nova Scotia will see the same growth rates, except the years are flipped around. It’s largely an energy story for Nova Scotia, with Venture and Deep Panuke causing output to double this year and double again in 2014. The return of NewPage supercalendered paper production will boost forestry exports by 15% in 2013. Read more here.
 

(Danielle Goldfarb – Globe & Mail)

Wayne Gretzky famously described how he was taught to “skate to where the puck is going, not where it has been.” Gretzky – to many, Canada’s greatest export – was talking about hockey, but the same principle applies to Canada’s trade. Many Canadian companies are still skating to where the puck has been, and missing many of the places where it is going.

India, for example, accounts for less than 1 per cent of Canada’s trade and investment, according to official estimates. Yet, India accounts for 7 per cent of the world economy today. It is expected to rise to 11 per cent by 2030 and to 18 per cent – almost one-fifth – of the world economy by 2060, according to OECD estimates. […]

A new Conference Board study, “The Hottest Markets for Canadian Companies in India,” finds many fast-growing, sizable, profitable, dynamic sectors. But despite two decades of economic reform, much of India’s economy remains relatively closed to foreign activity. So the study’s final list of hottest markets includes only those fast-growth sectors that are relatively open to Canadian business. Read more here.
 

(Dan Ovsey – Financial Post)

For the longest time, Eric Beauregard saw exporting to Europe as an attractive but not-so-urgent opportunity. The chief executive of Montreal-based AV&R Vision & Robotics — a maker of advanced automated systems for the aerospace industry  and others — was content to limit his export activity to the U.S. where demand for automation was high and buyers were plentiful. All that changed in September 2008.

“It was always a place we were looking to go but we thought you not only have the distance but the time zone and culture differences,” he says. “We thought that until we were really ready to go, we wouldn’t cross the sea and would be satisfied with Canada and the United States.” Read more here.
 

(EDC via CNW)

Pent-up demand is reappearing in key economic indicators following 4 years of sluggish global performance, setting the stage for an acceleration in world growth, according to a Global Export Forecast by Export Development Canada (EDC).

“Shaking off the memories of recent growth crashes, some as spectacular as they get, will be tough,” said Peter Hall, Chief Economist, EDC. “But as the race gets going and the adrenaline kicks in, economies may even surprise themselves with their renewed performance. The acceleration will lift the world economy by 3.6% this year, and 4.2% in 2014. It looks like this time, the race is on.”

“Canadian growth will soon require some fancy gear-changing, and it will be up to trade to shore up the bottom line as the domestic economy slows. It won’t disappoint,” said Mr. Hall. “Exports will leave last year’s modest growth in the dust, rising 8% this year and an additional 5% in 2014, benefiting from the resurgence in our largest trading partner, the U.S.” Read more here.

Related: EDC Dials Back View on U.S. Economy (Globe & Mail)
 

(IndustryWeek – AFP)

In an effort to reduce regulations that are thought to be putting American firms at a disadvantage, the United States on Tuesday eased rules on the export of select items in the aerospace industry.

The State Department said it was moving a series of “less sensitive items” from the U.S. Munitions List, which regulates exports, to a separate list maintained by the Commerce Department and seen by industry as less strenuous. […]

The items include parts and components related to aircraft and gas turbine engines, areas that the State Department said accounted for more than $20 billion in annual exports. Read more here.
 

(Montreal Gazette)

Canadian exporters have hit a snag after years of free trade agreements, and a new report from CIBC suggests businesses should look outside traditional export partners for further growth.

CIBC World Market senior economist Benjamin Tal says despite nine free trade agreements, the volume of Canadian exports has receded back to about the same level it was a decade ago. That’s because exports to countries outside the U.S. have hardly increased over the past four years – and in recent quarters, volume has actually dropped. Read more here.
 

(Vancouver Sun)

The Canadian economy needs to be more international and grow its exports to markets other than the United States, Scotiabank chief executive Rick Waugh says.

“We are several decades into globalization and still roughly three quarters of our exports go to the United States,” Waugh told the bank’s annual meeting Tuesday. “It’s no wonder Canada’s export performance is second to last in the G20…Relying on one customer is never good strategy.”

Waugh, who heads Canada’s most international bank, said he sees the most potential in emerging markets. “This year we expect GDP growth in our key international markets to be more than twice what it is in Canada and the U.S.,” he said. Read more here.
 

(FAITC)

Entry into force of Canada-Panama trade agreement eliminates tariffs on more than 90% of Canadian exports to one of the fastest-growing markets in the Americas

The Honourable Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway, today announced the entry into force of a bilateral free trade agreement between Canada and Panama that immediately secures a competitive advantage for Canadian exporters.

“Canada’s Economic Action Plan, with its focus on creating jobs, growth and long-term prosperity in every region of our country, includes opening new markets that increase Canadian exports,” said Minister Fast. “Starting today, this historic agreement will benefit Canadian exporters by immediately eliminating tariffs on more than 90% of Canadian goods exported to Panama. Workers and businesses in a wide range of Canadian sectors, such as aerospace, pharmaceuticals, pulp and paper and agriculture and agri-food, will benefit from taking Canada’s trading relationship with Panama to the next level.”

“The trading relationship between Canada and Panama continues to grow by leaps and bounds, having increased by 62 percent in less than four years,” said the Honourable Diane Ablonczy, Minister of State of Foreign Affairs (Americas and Consular Affairs). “This agreement is further proof of our government’s commitment to a robust presence in the Americas that increases economic opportunities for Canadians and delivers real benefits and prosperity for people throughout our hemisphere.”

In less than six years, the Harper government has concluded free trade agreements with nine countries: Colombia, Honduras, Jordan, Panama, Peru and the European Free Trade Association member states of Iceland, Liechtenstein, Norway and Switzerland. In addition, Canada is in ongoing trade negotiations with the European Union, India, Japan and the members of the Trans-Pacific Partnership. Canada also recently achieved observer status in the Pacific Alliance, a grouping of key fast-growing markets in Latin America. These accomplishments have been key to the Harper government’s work in opening new markets and increasing Canadian exports as part of the most-ambitious trade expansion plan in the nation’s history.
 

(Mike Godfrey – Tax-News.com)

Canadian ministers have been promoting the European Union (EU) trade agreement currently under negotiation, telling Quebec manufacturers and exporters that they can only benefit from the deal.

International Trade Minister Ed Fast, accompanied by Christian Paradis, Minister of Industry and Minister of State (Agriculture), took part in a roundtable session with the Manufacturiers et Exportateurs du Québec (MEQ). The EU is Canada’s second-largest trading partner, and according to Paradis: “Increasing Quebec’s exports to the mass EU market will create new jobs and new opportunities for workers and business throughout Quebec.” Read more here.
 

(Meagan Fitzpatrick – CBC News)

Foreign affairs minister says Canada is ‘reflecting’ on idea of free trade deal with China

Foreign Affairs Minister John Baird’s quick trip to Asia finished Wednesday in Hong Kong with a speech that laid out how Canada is making this region a foreign policy priority, and that getting a pipeline to the Pacific coast is key to tapping into the lucrative Asian market.

During a speech to the Asia Society. Baird said Canada realizes the enormous economic opportunities Asia has to offer and is taking steps to play a more active role here.

Baird spent Monday in Singapore, Tuesday in Vietnam and Wednesday in Hong Kong, where close to 300,000 Canadians live and 180 Canadian businesses have offices. It’s his seventh trip to Asia, and Baird said he plans on coming back often.

While trade and investment ties are growing stronger, they haven’t reached their full potential and Canada has yet to ink a free trade deal with an Asian country, Baird said. “We know that this region cannot be taken for granted and that there is no room for complacency. For this reason, we have made trade with Asia a top foreign policy priority,” he told an audience that included diplomats, religious and business leaders. Read more here.
 

(Toronto Star)

China and India will be vital destinations for Canadian exports in 2030, according to a forecast on trade released Monday. Though the U.S. will remain Canada’s top trading partner, emerging markets are becoming crucial, the latest HSBC Global Connections Trade Forecast said.

“The surprise is just how quickly companies are embracing the move towards being more international and being less reliant on the U.S., and how fast some of these individual trade corridors are growing,’ said Ben Arber, head of global trade and receivables finance, HSBC Bank Canada.

In 2011, the top five markets for Canadian exports were, in order, the U.S., the U.K., China, Japan and Mexico. China became Canada’s second-largest trading partner last year, Arber pointed out. The value of Canadian goods exported to China reached $19.3 billion last year, ahead of the $18.6 billion worth of goods shipped to the U.K., according to figures compiled by Industry Canada. Read more here.
 

(STR Trade Report)

The Obama administration delivered to Congress March 1 its 2013 Trade Policy Agenda and 2012 Annual Report. This document continues the administration’s focus on policies that will increase U.S. exports, such as seeking to “create and defend open markets” and “challenging unfair trade practices and enforcing U.S. trade rights under our agreements.” Priority issues for 2013 will include the Trans-Pacific Partnership agreement, a Transatlantic Trade and Investment Partnership with the European Union, and efforts within the World Trade Organization on trade facilitation, information technology and services. The administration also plans to “work with Congress on trade promotion authority” to facilitate the conclusion, approval and implementation of “market-opening negotiating efforts.”

The report highlights plans to continue or initiate numerous efforts, including the following.

National Export Initiative. The agenda asserts that overall U.S. exports of goods and services have increased by more than 39% from 2009, supporting one million additional domestic jobs. This is behind the pace needed to meet the NEI’s original goal of doubling U.S. exports by the end of 2014 “in support of up to two million additional U.S. jobs.” In 2013 efforts to advance the NEI will include the Export Promotion Cabinet coordinating through the Trade Promotion Coordinating Committee the launch of initiatives including a national marketing campaign targeting small and medium-sized exporters, an expanded Export University Program, the “Global Business Solutions” trade financing packaging that will work with community banks to expand the U.S. financial infrastructure offering trade-related products, commercial statecraft training for foreign service officers, and public-private partnerships that will deliver commercial services for U.S. businesses overseas.

TPP. The U.S. seeks “an ambitious conclusion” to the TPP negotiations and along with its partners is “working diligently” to try to complete the talks in 2013.

TTIP. The report notes the president’s intent to launch TTIP negotiations with the EU but gives no further details on when they might begin or how long they might last.
Read more »

(STR Trade Report)

In an article published in the January/February 2013 issue of the Federal Reserve Bank of St. Louis Review, two economists argue that government policies to bolster exports at the expense of imports would significantly harm U.S. manufacturing. The authors assert that imports of intermediate materials contribute significantly to the “outstanding performance” of manufacturing output and productivity and that “exports alone do not exert such a positive influence.” These findings suggest that the federal government’s National Export Initiative may be misplaced and that efforts such as lowering tariffs and expediting customs processing would do more to aid economic recovery.

According to the article, the public and economic commentators often gauge the strength of the U.S. economy by the quantity of manufactured goods produced. As a result, the increasingly smaller share of U.S. employees engaged in manufacturing – e.g., the percentage of workers engaged in manufacturing has dropped from just over 50% in the late 1940s to about 11% today, and the number of such workers fell from about 20 million in 1979 to about 11 million in 2010 – is seen as a cause for concern. The authors note that in recent years “such concern may have been exacerbated by the large-scale movement of domestic production of certain goods to lower-wage countries such as China or Mexico.” In this view “imports are bad because they represent the offshoring of domestic jobs and the death of U.S. manufacturing.”

The article adds that the most recent recession reinforced this view for many analysts. Manufacturing employment peaked in December 2007 and fell by over two million jobs by January 2010. Industrial production declined by about 21%, a much larger drop than average, and economic growth during the subsequent recovery has been weaker than normal. While the manufacturing sector has enjoyed a fairly robust recovery since the recession ended, the same cannot be said for manufacturing employment, rekindling fears about the “hollowing out” of the United States’ industrial capacity and leading critics to again target imports as the culprit. In addition, with exports having played a key role in manufacturing’s “impressive comeback,” many policymakers have advanced the idea that exports are one of the best elixirs for this sector.

“Surprisingly,” however, the article finds that “imports have played a critical positive role in boosting manufacturing output in the United States – much more so, in fact, than exports.” While neither imports nor exports cause manufacturing growth, reliance on imports of intermediate goods and capital goods has been “a strong positive influence on manufacturing output and productivity,” to the extent that the authors characterize such imports as “the lifeblood of U.S. output.”

By contrast, exports account for a much smaller share of manufacturing value added and there is “no discernible gain to manufacturing growth that could arise from new policies proposed to boost exports.” While the development of foreign markets offers an opportunity for outsized growth, the authors conclude, the success of manufacturing has not been as critically dependent on new markets for sales as for new markets for materials and capital goods.
 

(CBC News)

Canada‘s trade minister plans April trade trip to boost Canadian IT sales in Chinese hacking hotbed

The federal trade minister is promoting China as a key market for Canadian technology as that country is being outed as a hacker hotbed. Ed Fast says he’s headed to China and Japan in April to promote Canadian information communications technology.

In China, Fast will visit three cities, including Shanghai, the home of a military unit linked this week to cyber-espionage activities targeting companies around the globe. Fast says he’s going to Shanghai in particular because it’s an important area for the development of IT for business and mobile applications. He’ll also visit Hangzhou and Hong Kong as well as Japan to focus on medical imaging technology, along with business leaders from those industries.

Fast’s trade mission is his first to China since his visit with the prime minister last year.

A foreign investment and promotion agreement between Canada and China that was the centrepiece of Harper’s 2012 trip has yet to be ratified. Read more here.
 

(DFAIT)

Foreign Affairs and International Trade Canada (DFAIT) is organizing a Canada Trade Mission to Shanghai, Hangzhou (China) and Tokyo (Japan).

The trade mission will be led by the Honourable Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway and will highlight business opportunities in the following Information and Communications Technologies (ICT) sub-sectors:

• Enterprise solutions and mobile applications
• Medical imaging (Japan only)

Companies participating in the International ICT Expo in Hong Kong may find this trade mission a great opportunity to explore surrounding markets while you are in the region. Furthermore, companies in the field of medical imaging may choose to network with Japanese medical device companies by visiting the International Technical Exhibition of Medical Imaging (ITEM) 2013 in Yokohama (Japan) after the trade mission.

Bookmark and visit our webpage regularly for up-to-date information on this Canada Trade Mission.

Registration:
As we are only accepting a limited number of companies, applications will be considered on a first come, first-served basis and will depend on the company falling within the sectoral scope and business objectives of the trade mission. If you wish to receive a registration package, please contact me directly.

Deadline for registration, including full payment is Wednesday, March 6, 2013 at 17:00 EST.

We look forward to having you join us.

Jennifer Gowan
Trade Commissioner, Trade Missions
Tel.: 613-944-0077; Fax: 613-996-3406
jennifer.gowan@international.gc.ca
 

(Meagan Fitzpatrick – CBC News)

Canada needs to brand itself better to compete internationally, says business leader

Prime Minister Stephen Harper is now trying to make up for lost time when it comes to Canada’s ties with China, and there is a lot of work to do to brand Canada as a serious player in the international market, according to the head of the country’s biggest business association.

Perrin Beatty, president and chief executive officer of the Canadian Chamber of Commerce said in an interview last week in Hong Kong that both the federal government and the business community have ignored China’s booming economic growth for too long.

“During the first part of the current government’s term in office I’m not sure they fully understood how much Canada’s strategic interests were international — that our success in Lethbridge would depend on how we’re doing in Hong Kong,” said Beatty. “They’ve learned.”

Beatty said the Harper government is now more focused on diversifying trade beyond the United States and that there has been a “real maturation” in the government’s view on Canada’s relationship with China, but that “we’re playing catch up.” Read more here.
 

(African Manager)

A team of Canadian investors led by the Canadian Minister of International Trade and Asian Pacific Gateway, Mr. Ed Fast, on Wednesday met with Nigerian businessmen with a promise to expand existing bilateral trade ties between the two countries.

“I think what we are doing is really providing an impetus to Canada-Nigeria trade investment relationships. The future is very bright for the Canada-Nigeria trade investment relationships,” Mr. Fast said at a breakfast meeting organized for Canadian and Nigerian investors in the commercial city of Lagos.

The Nigerian High Commissioner to Canada, Ojo Maduekwe, who led his country’s trade delegation to the meeting pledged to fast track trade relationships between the two Commonwealth countries. Read more here.
 

(John Ibbitson – Globe and Mail)

This is the year of decision for the Harper government, when either it succeeds or fails in its effort to re-balance trade from vertical to horizontal, from north-south to east-west.

Parliament returns Monday to a legislative agenda that will largely be filled with housekeeping bills. The real agenda will be trade.

Either as part of the budget, or as a stand-alone item, the Harper government will release what one official, speaking on background, described “as close to a white paper as the Harper government will get on trade.”

That report will respond to the seismic shifts that are transforming this country’s trading relationship.

“Canada’s trading patterns have been fundamentally altered over the past decade,” the Conference Board of Canada concluded in a recent study. Read more here.