The Time is Now

We have all been watching the news; trade between Canada and the United States is top-of-mind for everyone. The steady commentary from CNN and the barrage of sensationalised headlines make this tough to ignore.

Exporting is part of the economic DNA of this province. In 2017 alone, New Brunswick exports were worth more than $12.8 billion; New Brunswick is Atlantic Canada’s largest exporter and the most export-dependent province in Canada. By selling our goods and services to the world, we are bringing new money into the economy and driving our province forward.

The Need for Diversification

More than 90 per cent of our exports go to the US. Arguably, today the risks associated with having all our eggs in one basket; or to be clearer, all our goods tied into one market is top of mind for both businesses and governments alike. Yes, prevailing protectionism sentiment is scary business when the US is by far and away your largest trading partner. Yet, the optimistic side of me sees this period of uncertainty as a real opportunity to recreate the narrative for NB as we look to the future. Sometimes all it takes is fear to spur one into action. My hope for NB is that we will look at the Trump Era as a time when we finally got serious about market diversification.

Opportunity in Europe and CETA

While the US remains our most vital trading partner, the recently signed CETA and CPTPP coupled with existing trade agreements provide NB exporters with preferential access to 51 countries representing over 1.5 billion consumers.

The EU was already our second largest market in 2017, with nearly $236 million in exports. CETA, which makes Europe an even more attractive market for NB exporters, will:

• Eliminate 98 per cent of tariffs on goods going to the EU;
• Create clear and simple rules of origin to simplify customs procedures;
• Allow New Brunswick companies to test their products to meet EU standards in Canada;
• Make it simpler for businesspeople to visit and move about the EU; and
• Will provide New Brunswick businesses with access to the $3.3 trillion EU government procurement market.

I am not proposing that we turn away from the US. No reputable business person would recommend that you walk away from your most important customer. We need to continue to nurture and invest in our business relationships with US clients. We need however to simultaneously seek and seize opportunities in new markets that, over time, will lessen our reliance on the US market. Market diversification is a long game. Change will not happen overnight, but I believe the time to act is now.

We have opportunities to diversify — and we need to. ONB is here to help.

ONB supports the growth and market diversification efforts of New Brunswick companies with export potential. Our team provides solutions to the challenges of expansion and opens new paths for growth on an international scale. Visit onbcanada.ca for more information - we are here to help.

Let’s make this happen.

Follow me on Twitter at @StephenLundCEO.