Andean Region Holds Promise

(Export Development Canada – Peter G. Hall)

When it comes to Canadian exports, the Andean region – Bolivia, Colombia, Ecuador, Peru and Venezuela – is not likely top-of-mind. But Canadian exporters and investors have been very active in the region in recent years, and there is much potential for growth well into the future.

Last year, Canada exported $2.1 billion worth of goods to the region. What is more, 2008 growth was about double Canada’s average, at an impressive 19%. This was no flash in the pan, either – growth has maintained a solid, double-digit pace in each of the last four years. Not only that, but over the same period, Canada also saw consistently strong growth in each of the five markets.

Agri-food exports dominate all other industry categories, at about 40% of total regional shipments, yet growth is below the regional average. Machinery and equipment exports together account for a sizable 16% of Canadian exports to the region, and as a group, grew at a 22% pace over the past four years. Other top exports are paper products, minerals and refined petroleum products.

Canada’s activity in the region is not confined to exporting. Canadian firms have undertaken direct investments in the region of over $4.4 billion, over half of which is in Peru. Colombia makes up an additional $1 billion, a tally that is growing by 28% annually. Venezuelan holdings are at $850 million, and rising 15.5% annually. Canada is also importing from the region. Growth in the past three years has been well below export growth, but with inbound shipments of $4.4 billion, is about 2.5 times as large. Crude and refined petroleum account for one third of imports, while precious metals make up an additional 27%. Imports of fruits, nuts and coal are also significant. Read more here.