While many economists believe the BRIC countries (Brazil, Russia, India and China) will kick-start this stubbornly slow economic recovery, it may well be the United States that will come to the rescue, according to a keynote speaker at the Shipping Federation of Canada’s 11th Annual Conference held in Montreal on April 4.

That’s because the BRIC economies are showing signs of slowing down, because they lack the depth to drive the recovery alone, and because the Chinese economy is still only half the size of the U.S. economy, said Stuart Bergman, Assistant Chief Economist at Export Development Canada. Moreover, Europe has its own fiscal challenges, including a sovereign debt crisis, resulting in fiscal austerity and slow, if any, growth.

“Credit markets are constrained as a result of the fact that inter-bank lending hasn’t really returned to normal levels. In the emerging markets, 75 per cent of all foreign-owed debt is owed to European banks, while consumer confidence, worldwide, is still around (or just slightly above) recessionary levels,” Bergman noted.

On the bright side, global economic gains are reducing excess production, with the U.S. reaching a point of balance between supply and demand.

“Auto sales (in the U.S.) are up and factory orders are up at a double digit pace from a year ago. There are more jobs and greater demand for goods and services, while industrial production is expected to continue going forward which will soak up production around the world,” noted Bergman. “Even the housing market is showing signs of recovery. The U.S. consumer accounts for 14 cents of every dollar in the world economy and the U.S. is poised to pick up the challenge.”

That assessment is backed by a 0.8 per cent increase in consumer confidence and spending in February, the biggest jump in seven months due to a an improving job market, rising stock prices and easier access to credit, according to the U.S. Commerce Department.

Despite our reliance on the U.S. economy, Europe should not be discounted, according to Martine Moreau, Director, Commercial Relations Division, Foreign Affairs and International Trade Canada who was offering her view on Europe and Eurasia. Europe represents 31 per cent of global GDP and remains Canada’s second-largest trading partner and second largest source of investments, accounting for a third of total direct investments in Canada, Moreau reminded her audience. The best opportunities to increase trade are in the areas of civilian aerospace, clean technologies, life sciences and information technology.

“There is still strong interest in natural resources in Canada. There are energy and natural resource sector opportunities, both in terms of resources and in technologies to explore for and extract resources. A potential free trade agreement with the EU might represent a $12 billion increase in Canada’s GDP and give Canadian companies a real opportunity in a market of 500 million people, Moreau suggested. “Enhanced two-way trade would give a boost to Canadian maritime traffic,” she added.

And let’s not forget Russia which is the 11th largest economy in the world, Moreau noted with opportunities in oil and gas, mining and construction equipment along with the agrifood and aerospace industries, although the investment climate remains a challenging risk with less than transparent business practices.

There are other investment opportunities in Latin America and Caribbean countries as well, according to Georges Lemieux, Senior Advisor, Latin America and Caribbean Bureau, Foreign Affairs and International Trade Canada.

Two-way trade since 2007 has increased 33 per cent, with Canadian direct investment in the area pegged at $146.8 billion in 2010 up from $8.1 billion in 1990.

“Latin America (excluding Mexico) represents 24 per cent of Canada’s direct investments (worldwide in 2010), mostly in the mining sector and trade with Latin America grew faster than the rest of the world.”

A lot of Canadian trade passes through the Panama Canal and the expansion of the canal will create greater opportunities for ocean carriers and shippers alike, Lemieux predicted.

And like Russia, there are “challenges” in dealing with the region, including poverty, pandemics and organized crime.

“There can’t be a resolution without regional cooperation. The shipping federation can play a significant role in increasing trade in Latin America,” Lemieux concluded.

What about the Asia-Pacific region?

“There are already more Fortune 500 companies in Asia (163) than the U.S. (133) and China’s GDP is expected to continue its strong growth. Meanwhile, Asia’s middle class is expected to reach two billion people by 2030, while urban Asia will soon have 13 of the world’s 25 largest cities”, noted Ron Hoffman, Senior Advisor of Asia, Department of Foreign Affairs.

While Canada’s two-way trade with Asia is growing, we’re still falling behind the competition, with Australia doing 300-400 per cent better than Canada, Hoffman pointed out. “The main competition has moved ahead of us, but the government is addressing the issue to catch up. Exports have not caught up with pre-recession levels and we’re not exporting enough to Asia, but the competition is tough,” said Hoffman. “The (stalled) Keystone pipeline highlights our dependency on the U.S. market.”

This year’s conference attended by 80 people and 110 for lunch was the 11th annual conference since 2001. It has proven to be an ideal forum to discuss hot button topics facing the shipping industry.

This year’s keynote luncheon speaker was Terry Mosher, better known as Aislin, one of Canada’s premier political cartoonists. He has been the editorial page cartoonist for The Gazette, Montreal’s English language newspaper for the past 40 years. He is recipient of numerous newspaper awards as well as having received the Order of Canada in 2003.