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The Canadian dollar is again consistently trading above parity against
the U.S. dollar. When this last happened, in 2007, many Canadian
exporters were caught unprepared as our dollar broke through that
symbolic barrier and their profit margins abruptly vanished. Many of
these companies, in order to continue exporting, slashed expenditures
as quickly as they could.
This time, however, Canada’s export community appears to be in a
much better position to cope with the dollar’s rise. Over the past few
years, and during the economic downturn in particular, many exporters
have made shrewd strategic decisions to safeguard their international
competitiveness. Now that global demand is finally showing signs
of recovery, these exporters are well positioned to increase their
international sales despite the Canadian dollar’s high value relative to
many major currencies, not least the U.S. greenback.
This white paper presents the key strategies that have enabled many of
Canada’s exporters to adapt successfully to the strong loonie. Supporting
data shows the extent to which each of these strategies has been used.
The data also highlights the areas that Canadian exporters may want
to emphasize so they can compete more effectively in a world where
the Canadian dollar is so strong.