Skip to main content

Canadian exporters already hurt by NAFTA talks even before U.S. trade dispute escalated: poll

Shipping containers are seen at the Fairview Cove Container Terminal in Halifax.

Andrew Vaughan/The Canadian Press

A growing number of Canadian exporters were saying the NAFTA talks were having a negative impact on their operations even before the trade dispute with the United States escalated in recent weeks.

A survey done for Export Development Canada found 28 per cent of the 1,000 exporters polled said the NAFTA talks had a negative impact on their Canadian operations. That was up from 23 per cent in an earlier survey.

“Current sales may be riding high, but trade uncertainty is having an impact,” EDC chief economist Peter Hall said in a statement Friday.

Story continues below advertisement

“Nearly one in five exporters say that NAFTA talks have negatively affected their investment plans. This reluctance to invest could severely restrain Canada’s export capacity in the years ahead.”

The survey was done from April 18 to May 11, before the United States ended an exemption for Canada on the global steel and aluminum tariffs it had put in place in March.

Since the tariffs went into place on Canadian metal exports at the end of May, Canada has imposed retaliatory tariffs on steel and aluminum coming from the U.S. as well as a wide range of consumer goods, while the U.S. has threatened additional tariffs on the auto sector.

The biannual survey found overall trade confidence increased to 76.5 per cent from 73.5 per cent in the previous questionnaire which was done at the end of last year.

The increase came as 73 per cent of Canadian companies indicated their export sales will increase over the next six months compared with 56 per cent in the previous survey.

More businesses said their sales to the U.S. increased over the past six months with 46 per cent reporting an increase compared with 36 per cent.

The EDC survey also noted that rising interest rates were having a negative impact on the sales of a larger share of exporters at 30 per cent compared with 21 per cent in the previous survey.

Story continues below advertisement

The Bank of Canada raised its key interest rate target to 1.5 per cent this week, prompting Canada’s big banks to raise their prime lending rates.

In raising the rate, the central bank said that despite the trade dispute it still projects Canadian growth to average just slightly above its potential with inflation already on target.

It expects the downside of the trade policies to be largely offset by higher oil prices and the stronger U.S. economy.

Report an error
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter