Canadians are finding it hard to keep the optimists with which they're usually associated, with respect to global trade, as questions mount almost everywhere else over the benefits of open economies.
The country is struggling to emerge from a 15-year slump in exports — among the worst track records anywhere. And with trade trending more toward protectionism, it may be a bad time to look for an export recovery as governments elsewhere turn away from the free-trade ethos that’s prevailed for the last two decades.
It’s to the point where Prime Minister Justin Trudeau has begun touting online sales of lobsters and cherries to China, and central bank officials are pinning hopes on the next big thing: the imminent flood of global business for the nation’s digital firms.
And data right now show a trading nation that’s forgotten how to trade.
In 2000, Canada was by far the most trade-dependent country in the Group of Seven, and one of the most among industrialized countries, with combined imports and exports making up 84% of gross domestic product. That ratio has fallen by about 20 percentage points. The country’s export growth rate, averaging just below 1% in volume terms since 2000, is the worst in the Group of 20 and second-worst among developed economies.
As a share of GDP, Canadian exports have fallen 14 percentage points since 2000 and has been hovering at about 31% in recent years, levels unseen since the North American Free Trade Agreement came into force in 1994. Imports are also dwindling in significance. They accounted for 38% of GDP in 2000 and today that figure is 34%.
Things started looking a little better in some sectors in recent years, particularly after the currency started to weaken along with oil in mid-2014, but the nation’s trade performance recently took a new hit. In 2016, exports are rising at the most sluggish pace since the recession
