Some Canadian exporters considering a move to U.S. amid NAFTA uncertainties: Survey
Correction: The EDC has further clarified the findings of its survey. It now says the results show that 23 per cent of firms surveyed consider ongoing NAFTA negotiations a risk, and of that group 26 per cent would consider relocating to the United States. Originally, the EDC had indicated the number of companies that would consider leaving was much higher.
OTTAWA — A new survey by Canada's export credit agency suggests some companies would consider relocating to the U.S. because of uncertainty created by ongoing NAFTA negotiations.
Twenty-three per cent of companies surveyed consider NAFTA uncertainty a risk to their operations. Of that group, 26 per cent would consider moving to the United States.
The semi-annual forecast by Export Development Canada underlines the challenges posed by the more isolationist approach to trade of U.S. President Donald Trump's administration.
Canada sends 75 per cent of all goods exports to the United States and could be badly hit if Washington walks away from the North American Free Trade Agreement. One way to cushion the potential blow is to set up shop in the United States.
Of the 1,002 firms surveyed by EDC from Oct. 2 to Oct. 25, 23 per cent said ongoing NAFTA negotiations were having a negative impact. The same percentage said they were trying to diversity their exports to new markets, with the focus on the European Union and China. Of that group, 26 per cent "indicated that they are moving — or are considering moving — part of their operations inside the U.S. border in response to the elevated uncertainty regarding U.S. trade policy."
Talks to modernize the treaty have so far failed to resolve major differences between the United States on one hand and Canada and Mexico on the other.
Despite the tensions, the vast majority of exporters expected overall conditions to remain the same or improve over the next six months, with little change in new orders from U.S. customers.
"Trade confidence is holding steady ... we can only imagine what it would look like without the NAFTA uncertainty," EDC chief economist Peter Hall said in a commentary.
With files from BNN