By KIM MACKRAEL (Wall Street Journal)
OTTAWA—The collapse in recent years of global commodity prices exposed structural weaknesses in Canada’s resource-rich economy after it had lost export capacity and market share in the years leading up to the 2008-2009 recession, a senior Bank of Canada official said Tuesday.
Deputy Governor Lawrence Schembri told an audience at the Atlantic Institute for Market Studies in Halifax, Nova Scotia, that Canada’s exports have grown by about 4% annually since the recession. He said that figure is well below the nearly 8% annual export growth that was recorded after recessions in the early 1980s and 1990s.
“Given the magnitude of the [2008-2009] economic downturn, this decline in global trade and Canadian exports was not unexpected,” Mr. Schembri said in prepared remarks. “What is now proving more difficult to explain is the weak recovery in exports, especially noncommodity exports, since 2012.”
Mr. Schembri said higher Chinese demand for commodities during the 2000s helped spur the expansion of Canada’s resource-based industries and exports, giving a strong lift to the country’s oil and gas sector. At the same time, the Canadian dollar strengthened against the U.S. dollar and Canada’s share of U.S. merchandise imports declined, falling more than 4 percentage points between 2001 and 2009.
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