National flags of the United States, Canada, and Mexico fly in the breeze in New Orleans recently. The North American Free Trade Agreement between the three countries is the subject of renegotiations.
©The Canadian Press
As Canada, the U.S. and Mexico holds talks to update the North American Free Trade Agreement (NAFTA), the latest report from the Atlantic Provinces Economic Council (APEC) says the region’s four provinces are heading in different economic directions.
“Prince Edward Island seems to be on a tear, leading the country in retail sales and new home construction and second only to BC in employment growth,” Fred Bergman, APEC’s senior policy analyst, says in a news release. “By contrast, Newfoundland and Labrador is in the midst of a multi-year slowdown brought on by the sharp drop in oil prices since 2014, compounded by the end of the investment boom.”
Nova Scotia and New Brunswick are growing, but are generally in the bottom half of provincial rankings in the first half of 2017, with employment, earnings and retail sales all below the national pace, APEC says.
Housing starts in those two provinces, however, are growing faster than they are nationally.
The Atlantic Currents report says all four provinces have a lot at stake as the NAFTA talks begin in Washington.
“The renegotiation of NAFTA is of critical importance to Atlantic Canada,” Bergman said. “The Atlantic provinces exported $19 billion of goods to the U.S. last year, about 75 per cent of its merchandise exports. About 91,000 jobs in this region depend on exports to the U.S., about eight per cent of total employment."
Atlantic exports to Mexico amounted to $102 million in 2016, according to APEC.
The Atlantic Business View of NAFTA
APEC says in a roundtable discussion of small and large firms last month, one of the biggest concerns raised was the need to improve access and reduce the uncertainty for business professionals travelling to and from the U.S. APEC says the participants also want to retain the Chapter 19 dispute resolution mechanism — when anti-dumping and countervailing duties are imposed by another party — but wanted to see a speedier process and a better way of sharing legal costs.
The NAFTA overhaul will be on the agenda at APEC’s business outlook conference in November.
Provincial highlights for Newfoundland and Labrador, according to APEC’s report:
• More than 18,000 jobs have been shed since the start of 2014, with employment now close to pre-2008 recession levels. The province is forecasting a further 17,000 job losses over the next few years as major project investment continues to decline.
• The province had seen steady population growth since 2007, aided by a drop in outmigration to other provinces. However, the population decline has resumed since mid-2016 with a net outflow of 1,700 people leaving the province over the last three quarters.
• Despite the overall economic weakness, wages continue to grow — up 2.5 per cent so far in 2017, above the 1.5 per cent national pace.