As Canada’s most diversified export economy, British Columbia has weathered the volatility in the global economy better than many other provinces – and Canada as a whole. That diversification also puts B.C. in a good place to benefit from the continuing recovery in the United States and rising energy prices in 2016, with B.C. export growth next year forecast by EDC to be six per cent.
You don’t have to look far to see how diversified B.C.’s exports are. While the U.S. accounts for more than three-quarters of Canada’s exports, it takes barely half of B.C.’s. And while about 11 per cent of Canadian exports go to emerging markets, the figure for British Columbia is more than 25 per cent. Asia is a large part of B.C.’s export picture, with China, Japan, South Korea and Taiwan providing more one in every three export dollars earned by the province’s businesses.
It’s not just geographic diversity that helps B.C. maintain a positive export picture; the province is also highly diversified in what it sells to the rest of the world. Forestry remains its biggest export sector, but it also has a large presence in energy and in metals, ores and other industrial products. Together, these three sectors make up about three-quarters of B.C. exports. But as EDC’s Global Export Forecast Fall 2015 notes, a softer export picture in these sectors is being offset to some degree by double-digit export growth in other sectors, notably agri-food, which will see 23-per-cent growth this year.
So even though lower energy prices have pushed down B.C.’s energy exports this year by 24 per cent, overall export growth is still positive, at one per cent across all sectors. If you take energy out of the mix, those exports are set to grow by a very healthy seven per cent. And EDC forecasts solid growth in all sectors – including energy – in 2016.
Clearly diversification works. Granted, not every province can replicate what British Columbia has been able to do – its West Coast location gives it a natural advantage for selling into Asia-Pacific markets and its mix of natural resources, agriculture, and manufacturing and services means it doesn’t have to rely on any one sector. But the B.C. export story shows that, by spreading out both what it sells and where it sells, its businesses can continue to prosper, no matter what the global economy is doing.
You can find out more about the B.C. story – and what’s happening in the rest of Canada – in EDC’s Global Export Forecast Fall 2015.