Yet mood for expansion rests on stable economic growth at home
MISSISSAUGA, ON, May 23, 2012 /CNW/ - Federal Finance Minister Jim
Flaherty's persistent coaxing of Canadian business to diversify
international trade beyond the United States may be gaining traction as
71 per cent of large, medium and small businesses in Canada project
China or India to represent the largest increase in trade this year.
Only five per cent of businesses project the U.S. to be the fastest
growing source of exports and imports in 2012.
According to a quarterly survey of Canadian business commissioned by UPS
Canada and conducted by Leger Marketing, the business community's
positive outlook on growth is contingent on the continued stability of
the Canadian economy. This optimism is also fuelling a boost in
innovation, as nearly three quarters of respondents (71 per cent) plan
to launch a new product or upgrade an existing one in 2012. Canadian
business is particularly bullish about global expansion with 62 per
cent of medium-to-large businesses identifying exporting as a
"It's very reassuring to see such a groundswell of optimism and ambition
regarding global expansion among Canadian businesses as we move into
the latter part of Q2," said UPS Canada Director of Small Business Paul
Gaspar. "But as we saw in February when the GDP numbers were released,
the shift to go global is still somewhat tenuous."
According to the survey, the strength of the Canadian economy is the
single biggest influence on business goals and direction at 33 per
cent. The next three influences are rising oil prices at 13 per cent
and the sluggish global economy and anaemic U.S. market at 12 per cent
respectively. Given the renewed appetite for global trade with an
emphasis on Asia, the strength of the Loonie influences the goals and
decisions of only nine per cent of respondents.
Looking more closely at the export data, a majority of businesses
foresee China (56 per cent) as the country that is the most likely to
see increased trade with Canadian business. Its growing consumer base,
coupled with the Federal Government's renewed diplomatic efforts at the
beginning of the year, should help the nearly one-third of businesses
(32 per cent) who are interested in expanding to China turn their plans
into tangible results. Next (but significantly lower) on the list of
countries expected to see a growth in trade with Canada is India at 15
per cent, followed by Mexico (10 per cent) and Brazil (eight per cent).
The U.S., Canada's conventional go-to trading partner, is a distant
fifth at only five per cent.
"The Canadian business sector has been somewhat spooked by the economic
volatility south of the border and now that it's showing signs of
greater stability — even more so than in Canada — I expect business
will give it more attention in subsequent quarters. But I can't
emphasize how important it is that the business community is also
grabbing hold of the potential in Asia and other emerging markets.
Diversified trade will only help our long term prospects," said Gaspar.
While China is the preferred trade partner amongst business leaders who
plan international expansion within the next five years, it was a close
race between the next four countries. Twenty-nine per cent chose Mexico
as the second-most favourable partner, followed by India at 26 per
cent, Brazil at 25 per cent and the U.S. at 23 per cent.
The theme of growth extends to recruitment as well. The majority of
business leaders say they will increase staff over the coming year,
with 32 per cent of the increase expected to be in sales, followed by
20 per cent in marketing and promotion. Companies in Eastern Canada are
particularly interested in growing staff, as 25 per cent plan on
aggressive recruitment tactics. This East Coast desire for growth
relates to the fact that over a third of those business leaders (36 per
cent) are confident in the growth of the professional services sector.
About the survey
From April 9 - 19, 2012, Leger Marketing conducted an online survey
among a sample of 250 Canadian business decision makers (CEO, executive
level, senior managers). The margin of error for a sample of this size
is accurate within 6.20%, 19 times out of 20.
UPS (NYSE: UPS) is a global leader in logistics, offering a broad range
of solutions including the transportation of packages and freight; the
facilitation of international trade, and the deployment of advanced
technology to more efficiently manage the world of business.
Headquartered in Atlanta, Ga., UPS serves more than 220 countries and
territories worldwide. The company can be found on the web at UPS.com and its corporate blog can be found at blog.ups.com. To get UPS news direct, visit pressroom.ups.com/RSS.
SOURCE UPS Canada Ltd.
For further information:
Erick Bauer, APEX Public Relations