Export Development Canada’s (EDC) forecast for Nova Scotia’s export growth calls for a rebound of 17 per cent in 2013 after a 14 per cent decline this year.
“Nova Scotia’s export growth will lead the country in 2013 with a jump of 17 per cent, driven by a more positive outlook for the natural gas sector, paper mills coming back on line and improved U.S. demand,” said Peter Hall, Chief Economist, EDC. “Next year’s growth is a relief, a welcome sharp rebound from the 14 per cent decline in 2012.”
“Global recession has battered Nova Scotia’s export sector, with a sharp saw-off in the number of exporters from 819 in 1999 to just 670 in 2010,” said Hall. “The good news is that the dominant U.S. market is poised for recovery, and second-place China is still growing at a good clip.”
Nova Scotia exports depend on fish and fish products, motor vehicle parts and forestry sectors, which together account for two thirds of total international sales.
The agri-food sector, largely comprised of fish and fish products, generates over a quarter of the province’s total exports. EDC expects agri-food exports to grow by 5 per cent next year after a 9-per-cent gain this year. Exports of fish and fish products are expected to rise this year and next, driven by higher shipments of lobster, crab and shrimp.
“The aquaculture sector will continue to boost agri-food exports, with more investments driving up capacity,” said Hall. “Nova Scotia’s focus on sustainable seafood products is creating lucrative global opportunities and has the potential to command premium prices.”
Nova Scotia’s auto parts sector accounts for more 24 per cent of the province’s total exports, and is forecast to grow by 10 per cent next year, following a 4-per-cent gain in 2012. “
“The auto parts sector, led by Michelin, saw production growth soften this year mostly due to weaker demand from European markets,” said Hall. “But as the imminent U.S. recovery kicks in next year, an increase in vehicle production in the U.S., a positive pricing environment and favorable raw material costs will see exports accelerate next year, with upside potential.”
The forestry sector is also important to Nova Scotia’s export picture, responsible for 16 per cent of the province’s total exports, and will see growth of 103 per cent growth next year after a 50-per-cent decline this year.
“The reopening of the NewPage Port Hawkesbury paper mill will be the base of the forestry export story next year,” said Hall. “The shutdown of the Bowater Mersey Mill in Brooklyn, while impactful to the province, is not expected to weigh down export growth as most of its production supplies the domestic market.”