With an abundance of natural resources, and a bustling agriculture industry, trade is vital to the Saskatchewan economy. The province exports more products per capita than any other province, and recently overtook British Columbia to become the fourth largest exporting province in absolute terms.
In 2013, the province posted a positive trade balance with not only China, India and Japan, but also the United States, which is all the more impressive considering Saskatchewan receives the vast majority of its imports from the U.S.
But for this trade prosperity to continue, Saskatchewan needs a seat at the negotiating table, and to take a leading role in carving out new markets for itself.
Luckily, much of the infrastructure that will be required is already in place. Within the province, the Saskatchewan Trade and Export Partnership (STEP) is a joint public-private institution with a mandate to promote exports from Saskatchewan and assist firms with taking their product internationally.
STEP reached an agreement in 2010 with a Chinese organization called the China Council for the Promotion of International Trade (CCPIT), which gives firms in Saskatchewan greater access to markets in China. Alberta, British Columbia and Saskatchewan also established the Western Canada Trade and Investment Office in Shanghai in order to have a more direct presence in China.
With the province taking such an active role in trade relations, exports to China have greatly increased, from $1.5 billion in 2010 to $2.6 billion in 2013.
While the trade picture in large markets like China is rosy, Alberta provides an excellent example for Saskatchewan to follow when it comes to smaller markets.
Saskatchewan’s top export to South Korea in 2011 was wheat – $195 million worth. But by 2013, wheat exports to South Korea had fallen 83 percent, to just $33 million.
The good news is that Canada’s recently signed free trade agreement with South Korea will immediately lift many tariffs on agricultural products from Saskatchewan, which Premier Brad Wall has cited as one of the main contributors to the decrease in exports.
But that’s not enough; there is still ground to be gained in many markets.
Saskatchewan officials could wait for Canada to continue its aggressive push towards bilateral and regional trade agreements, but it’s ultimately in their interest to take a more active role.
Alberta has offices in the U.S, China, Mexico, Germany, Taiwan, the United Kingdom, and more. The province has been able to successfully create new markets for itself and ensure its firms have every opportunity to grow their business globally.
While Saskatchewan’s smaller size may not justify quite as large a program, India and Brazil are obvious choices for such a provincial initiative, given their large markets and recent willingness to trade.
The potential gains to be made from improving relations with Bangladesh and Malaysia shouldn’t be discounted either.
Leguminous vegetables and wheat, Saskatchewan’s top two exports to Bangladesh, are both on the rise. In 2012, exports of vegetables totalled $93 million. In 2013, that number jumped up to $224 million. With the potential for this number to rise even further, Bangladesh should be one of the top destinations for Saskatchewan’s new set of trade offices abroad.
Trade is growing Saskatchewan’s economic and social profile not only across Canada, but throughout the world. The foundations, and the markets, are there. Now all that’s needed is the political will to execute such a plan. Trade is surging, and the markets are calling.