TORONTO, ON, May 26 — A new report released by the Toronto Region Board of Trade’s trade services arm, World Trade Centre Toronto, Opportunity Knocks: Priority Export Markets for Ontario's High Potential Sectors, looks at how the lack of exporting among Canadian small and medium-size enterprises (SMEs) represents untapped growth potential, and provides analysis of a broad range of export opportunities available.
Only 12% of Canadian small businesses are exporting their goods and services, even as Canadians create new firms at a higher rate per capita than Americans and rank second in the world for starting a business.
“With a relatively small domestic market, international trade is a key driver of growth, job creation and scale-up opportunities for Ontario businesses,” says Leigh Smout, President of the World Trade Centre – Toronto.
Increased exports lead to substantial and resilient job creation. According to the Conference Board of Canada, approximately 1,000 new jobs are created for every $100 million increase in exports, and these jobs typically have higher-than-average wages.
According to Smout, “While Canada’s network of 14 free trade agreements, along with recent developments in digitization are key tools in achieving export access, exporting to a new market requires significant due diligence, market research and established business relationships. SMEs in particular need supports in place to help them navigate international waters.
“We’ve gone ahead and done the hard work on behalf of SMEs. Opportunity Knocks undertakes a comprehensive analysis of export opportunity indicators that point to new and exciting trade partners beyond the usual suspects,” he adds.
With projected global population growth expected to hit 10 billion people by 2050, it is expected there will be increased demand for products and services that are key to Ontario’s SMEs, such as manufactured consumer goods, food and healthcare. Additionally, Internet of Things applications in manufacturing and factory settings alone are forecasted to generate $1.2 to $3.7 trillion in economic value annually by 2025. With over 350 automation and robotics-related companies in the province, Ontario is well positioned to capture this market share.
To get Ontario SMEs exporting, Opportunity Knocks uses commissioned trade data to identify six separate sectors with high export potential, and lists sector trends and key target export markets. The six sectors are:
- Consumer Good Manufacturing & Retail
- Agri-food & Agri-Tech
- Financial Services, Fintech & Cybersecurity
- City Tech
- Healthcare, Life Sciences & Medtech
The report highlights the importance of support programs like the World Trade Centre Toronto’s Trade Accelerator Program (TAP), which provides the training and capacity-building needed by SMEs to develop a strategic export plan; and the Market Activation Program (MAP), which helps companies develop meaningful contacts in the most opportunity-rich foreign markets.
With Ontario’s relatively small domestic market, international trade is going to continue to be a key driver of growth, job creation and scale-up opportunities for provincially-based businesses. Those businesses that export have also reported higher sales, will prove to be more resilient in economic downturns, and will grow faster.
Opportunity is knocking for Ontario SMEs. It is time to answer.
Report Highlights by Sector
Consumer Good Manufacturing and Retail
- Manufacturing is the largest contributing sector to SME exports across every region of Ontario with 34% of SMEs exporting
- Less than 3% of SMEs in Ontario’s retail sector export their products
- New Opportunities: Chile, Estonia, Jamaica, Panama, Philippines, Qatar, Saudi Arabia, UAE, Kuwait and Slovenia
Agri-food and Agri-Tech
- Agriculture and agri-food sector is one of Ontario’s fastest growing, contributing just under $25 billion to Ontario’s 2019 GDP
- With massive growing global demand for food, expected to rise by 70% by 2050, increasing exports is a clear opportunity for Canadian SMEs to grow
- New Opportunities: Brazil, Estonia, Malaysia, Slovenia and Thailand
- Over 55% of the world’s population lives in urban areas, with that proportion projected to increase to 68% by 2050
- The market for city tech goods is projected to reach over USD$460 billion by 2027
- New Opportunities: UAE
- The success of Canada’s cleantech sector depends on exports
- In 2018, Ontario cleantech firms exported $6 billion with a GDP value of almost $12 billion
- New Opportunities: Brazil and UAE
Financial Services, Fintech and Cybersecurity
- In 2019, SMEs in this sector exported over $4 billion in goods, but there is significant room for growth with just over 1% of SMEs in the sector exporting goods
- The cybersecurity global market is expected to reach USD$300 billion by 2024
- New opportunities: Lithuania, Poland, UAW, Bahrain, Qatar, Saudi Arabia, UAE and Kuwait
Healthcare, Life Sciences and Medtech
- Ontario’s healthcare and social assistance sector contributed over 7% to Ontario’s 2019 GDP
- In 2019, less than 1% of all healthcare and social assistance SMEs exported goods
- New Opportunities: Chile, Poland, Thailand and Vietnam
Opportunity Knocks was made possible thanks to the generous support of Western Union Business Solutions, who sponsored the development of the report.
About Toronto Region Board of Trade
The Toronto Region Board of Trade is one of the largest and most influential business chambers in North America and is a catalyst for the region’s economic agenda. We pursue policy change to drive the growth and competitiveness of the Toronto region and facilitate market opportunities with programs, partnerships and connections to help our members succeed – domestically and internationally.
Andrew Perez, Media Relations Manager