The Harper government has replaced Canadian foreign policy with export promotion, and made global trade the latest plank in its permanent election campaign. Last week it released the Global Markets Action Plan, featuring a public relations effort similar to its long-standing Economic Action Plan.
Putting small- and medium-sized business up on the export platform is a main objective of economic policy according to the Conservatives. The paper talks of export zones with private equity finance, innovative technology, being tied into world centres, and breaking into priority emerging markets.
Accordingly, Canadian embassies will now become a branch of Canadian industry, dedicated to promoting the profits of Canadian companies. The plan lists 22 sectors where Canadian firms are said to be world-beaters, ready to take on international competition.
The issue of how "Canadian" are foreign-owned firms which dominate some of these sectors (auto for instance) and how much foreign firms intend to go abroad for Canada, create jobs here, and remit profits here, is ignored.
Instead, expect to see publicly funded government ads running in the months up to the October 2015 election extolling the virtues of exports for Canadian prosperity.
The new plan has the backing of the same business lobby groups that have been dictating economic policy in Canada for more than 30 years: the Canadian Federation of Independent Business, Canadian Chamber of Commerce, Canadian Council of Chief Executives, and Canadian Manufacturers & Exporters.
A former Foreign Affairs chief economist and deputy chief economist have taken a good look at economic policy and thrown cold water on the idea that it makes sense to convert Canadian small- and medium-sized businesses into champion exporters. The evidence suggests when conditions change, firms exit the export market. About 13,000 small and medium businesses left the U.S. market when in 2006 the Canadian dollar rose sharply, cutting or eliminating profits margins.