Stuart Bergman headshot, EDC
Stuart Bergman Vice-President and Chief Economist Export Development Canada Stuart Bergman

According to our latest Trade Confidence Index (TCI), confidence fell across all regions of the country. While all components of the index dropped, domestic economic conditions and domestic sales posted the sharpest declines in our biannual survey.

Since 1999, Export Development Canada (EDC) has gone out into the market twice a year to gauge exporter sentiment on economic conditions, business activity, and prospects going forward. Our data set, now spanning a quarter of a century, provides unique insights into the risks and opportunities facing exporters across sectors, of different sizes and by region. This round, to further improve the accuracy of our results, we expanded our sample size to more than 1,200 respondents, with plans to continue to enhance the representativeness of our survey.

The results? According to our survey, the TCI fell to 65.7 points, from 68.6 at mid-year 2023. Quebec notched the weakest confidence score (64.9), while Ontario businesses’ reported the highest confidence (66.8).

Exporters of all sizes expressed weaker confidence, led by large businesses, which saw a decline of 7.9 index points, to 65. Small businesses, meanwhile, experienced a fall of 3.3 points, settling at 65.8. The outlook for medium-sized businesses remained somewhat steady, at 66 points.

Of the top risks preoccupying exporters, a deep global recession was cited by 61% of respondents, followed by supply chain issues (39%), as pressures on shipping routes mount. In fact, almost 40% of respondents pointed to transportation as their biggest infrastructure challenge, in a new set of questions we asked this time. Given that the survey was in field over the October-November timeframe, the fallout from the Israel-Hamas war likely weighed heavily on responses, in addition to domestic bottlenecks.


More than 60% of our respondents expect global conflict and war to worsen over the next six months—one of the main reasons for their negative outlook on economic conditions. Closely linked are the lingering impacts of inflation, which continue to dampen the outlook, as rising costs and elevated interest rates cut into margins and restrain cash flow. Inflation was cited by 72% of respondents as a leading concern, with three-quarters of our sample expecting high inflation to last more than six months. It’s no surprise, then, that the most common business challenges remain rising expenses (34%) and global economic conditions (32%).

Higher borrowing costs continue to negatively impact almost 70% of respondents. What’s more, almost 40% expect financing terms and conditions to worsen over the next six months. This time, as a new exercise, we added questions around trade financing, in particular. Our survey found that one-third of businesses requested trade financing. Of those, less than half had their financing needs fully authorized and more than 20% had their requests rejected outright, highlighting a growing need and gap in the market.

Interestingly, many respondents noted that they requested less trade financing than they required. Of those who received loans, 22% asked for less than they actually needed. Meanwhile, of the respondents who had their loans partially authorized, 38% asked for less than needed. And of those whose requests were rejected, a whopping 55% asked for less than they needed.

The average amount of trade financing requested by the businesses in our sample was slightly less than $2.8 million, and on average about $1.4 million worth of trade financing was rejected for TCI respondents. These sums point to a still-sizeable market gap in the Canadian trade finance space, underscoring the importance of EDC’s mandate to support Canadian exporters.

Of the businesses surveyed, almost 45% derive more than half of their sales revenues through exports and 60% primarily export goods. More than 40% of respondents started exporting to new countries in the last two years and 66% plan on exporting to new destinations going forward. Of current exporters, a majority export to the U.S. (87%), followed by Western Europe (33%) and the Indo-Pacific region (21%).

The bottom line?

While the results of our year-end TCI, which published Dec. 19, 2023, aren’t much to get excited about, we hope that new questions and areas of exploration will offer insights on how EDC and others can help meet exporter needs. Geopolitics and macroeconomic conditions continue to impact trade confidence, worsening cash flow, profits and financing conditions. As we begin 2024, we look forward to helping your business meet these challenges head on, giving you the advantage you need to take on the world. 

This week, a very special thanks to Prerna Sharma, senior economist in EDC’s Economic & Political Intelligence Centre.

As always, at EDC Economics, we value your feedback. If you have ideas for topics that you’d like us to explore, please email us at economics@edc.ca and we’ll do our best to cover them.

This commentary is presented for informational purposes only. It’s not intended to be a comprehensive or detailed statement on any subject and no representations or warranties, express or implied, are made as to its accuracy, timeliness or completeness. Nothing in this commentary is intended to provide financial, legal, accounting or tax advice nor should it be relied upon. EDC nor the author is liable whatsoever for any loss or damage caused by, or resulting from, any use of or any inaccuracies, errors or omissions in the information provided.