The bumpy state of the NAFTA negotiations combined with global trade uncertainties has some Canadian businesses rethinking their international marketing plans, says the Export Development Corp. The Agency's Trade Confidence Index for the last six months found the overall optimism of Canadian business in their export prospects had dropped marginally during the last six months despite a stronger loonie and softening Canadian merchandise exports, the EDC said. “Canadian exporters have many reasons to be fearful and to pivot their business strategies right now,” said Peter Hall, EDC's Chief Economist. “Anti-trade rhetoric continues to dominate the headlines; major trade agreements are being renegotiated or scuttled and there's a real-time threat to Canada's relationship with its largest trading partner. “And while companies aren't necessarily panicking, we found that almost one quarter of Canadian exporters said that the on-going NAFTA renegotiation was having a negative impact on their Canadian operations and they already are or plan to implement strategies to mitigate this.” The survey found “a significant drop in the number of Canadian exporters planning to export to the U.S. market in the next two years. This new finding is part of emerging — albeit tentative — evidence that suggests slower growth in Canadian export capacity and interest.” “Despite a challenging external environment, the bottom line is Canadian trade confidence appears to be holding its own but is being pulled in different directions by opposing forces,” said. “This is a direct reflection of the clash of conditions we now see in the global economy and we can only imagine what it would look like without the NAFTA uncertainty. At about the same time as the EDC survey was released, the Commons international trade report issued a report on the importance of Canada's ties with its NAFTA partners and called for a greater effort to pitch the benefits of the trade deal to Americans. “Many Canadian businesses, the workers who they employ and the communities in which they operate depend on access to North American markets, and the integrated value chains among the three countries,” the committee said. “Canada must also raise awareness of its trade relationship with United States among American legislators, voters, businesses and state governors.” Recognizing that the North American economic partnership involves three countries, the Committee believes that the NAFTA negotiations should remain trilateral, and focus on increasing the competitiveness of Canada, the United States and Mexico as a region. That means a renewed NAFTA must preserve the ability of businesses in the three countries “to sell into the U.S. and Mexican markets, and to participate in cross-border value chains.” While protecting access in NAFTA, Canada also needs to focus on increased access to international markets, the committee said. To be successful, businesses “must have access to trade-related training and be made aware of the range of federal trade-promotion services that are available to them.” That would training in e-commerce. “Whether the focus is increased trade with NAFTA partners or with other countries, the governments of Canada, the United States and Mexico can help businesses by addressing border-related and regulatory impediments,” the committee said. During public hearings, it heard of “border delays that negatively affect Canadian businesses that trade with the United States, and highlight the need for modern border infrastructure and customs processes.” The committee also called for the maintenance of dispute settlement mechanisms. “Each NAFTA country must have recourse against any other NAFTA country that acts in a manner that is inconsistent with NAFTA, and that an impartial mechanism for reviewing anti-dumping and countervailing duties orders must exist.” The EDC said its survey found Canadian companies are paying more attention to the European market because of the new free trade deal. “They are planning to expand their existing exports to Europe, and/or are developing new products and services for the European market, as well as taking advantage of cheaper European imports due to tariff reductions.” As for the exploratory discussions with China about a trade negotiation, EDC found Canadian exporters were challenged by “conforming with local regulations or standards; protecting intellectual property rights; language and cultural differences; building relationships; obtaining market information; securing payment; and competition from state-owned enterprises.” A nagging worry for Canadian businesses is the threat of higher interest rates. “Nearly one-quarter of respondents reported that higher interest rates were having a negative impact on export sales.” Alex Binkley is a freelance journalist and writes for domestic and international publications about agriculture, food and transportation issues. He's also the author of two science fiction novels with more in the works.