Canada needed to diversify its traditional offerings of mineral and wood product exports into direct investment if it was going to make a greater impact in China, the head of the country's export credit agency said Monday.
At a breakfast meeting of the Asia Pacific Foundation of Canada in Vancouver, Eric Seigel, president and CEO of Export Development Canada (EDC), an agency that assists more than 8,400 Canadian companies doing business abroad, said the credit crunch and the result of the global economic recession demonstrated that companies needed to diversify their customer base and production networks.
Canada, in particular, remained dependent on the United States, its largest trading partner. Last year, despite America being the "epicenter of a global financial meltdown," Seigel said his country shipped 75 percent of its merchandising exports to its southern neighbor, down from 87 percent in 2002.
In contrast, Canadian goods going to China accounted for only 1.1 percent of all merchandise exported into the country over the past five years. The story was similar in exports to India and Vietnam.
"The bottom line is Canadian exports to Asia are not keeping up with the growth in imports," said Siegel, who will visit Shanghai and Beijing later this week to talk about the EDC's key relations with China Export and Credit Insurance Corporation and China Development Bank, among others, and funds the agency has invested in to help bring Canadian capital into the Chinese market.
"Imagine what could happen if large industrialized markets accounted for just over half of Canada's exports, and emerging markets took up the remaining space," he said. "In place of the 6.5 percent average growth seen from 2004 to 2008, Canadian merchandise exports could easily have expanded by 10 percent annually."
"Diversification would have partially cushioned the recessionary blows that exports suffered last year," he said.
While the increased exports would be dramatic, he said it could possibly add one percent to Canada's annual GDP growth.
Source :- news.xinhuanet.com