Release Date: 07 May 2007
Release ID: 1275
Ontario’s export growth is forecast to decline by 3 per cent in 2007 before flattening out in 2008, according to a provincial export outlook by Export Development Canada (EDC). EDC Economics also forecasts that the auto and forestry sectors will begin to emerge from the bottom of their business cycles through 2008.
“Ontario exporters will continue to struggle in the near term. This year’s 3 per cent decline comes on the heels of a 1.4 per cent drop in 2006, as U.S. weakness hits exports of motor vehicles, forestry and consumer products, and industrial goods,” said Stephen Poloz, Senior Vice-President of Corporate Affairs and Chief Economist. “2008 will see exports level off, as US economic performance picks up.”
The auto sector accounts for more than 41 per cent of Ontario’s exports, and is projected to fall a further 6 per cent in 2007 as U.S. auto sales fall to a 9-year low. In 2008, EDC expects auto exports to stagnate, as the US auto market begins a modest recovery and the restructuring of domestic auto producers nears completion. Strong global demand for industrial inputs and robust commodity prices supported exports of industrial goods, including metals, chemicals and plastics, in 2006. However, industrial export receipts are expected to post zero growth in 2007 and a 1 per cent decline in 2008 as commodity prices ease further. The industrial goods sector accounts for 26 per cent of Ontario’s exports.
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.
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