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EDC Trade Confidence Index shows exporters navigating uncertainty

Survey hits near-record low as Canadian exporters adapt to global pressures

Upscale coffee shop owner wearing apron sits thoughtfully with laptop and notebook, planning menu.

 

 

Head shot of Stuart Bergman, EDC’s chief economist, standing by glass window.

Stuart Bergman

Vice-President and Chief Economist
Export Development Canada

 

 

Insights from EDC’s chief economist

Export outlook weakens amid trade and tariff pressures

Export Development Canada’s Trade Confidence Index (TCI) has dropped to one of its lowest levels on record, even as Canadian exporters pursue new markets to manage rising uncertainty. The latest survey reflects growing concern amid escalating global trade headwinds, while also highlighting a more targeted approach to diversification.

Since 1999, EDC has surveyed Canadian exporters and ready-to-export businesses twice annually to capture timely, forward-looking insights not found in traditional trade statistics. The TCI captures the perspectives of more than 1,000 companies on their international strategies, expectations and challenges.

In this round, 1,073 respondents participated between May 30 and July 13, 2025. The TCI score—based on responses from 688 exporters—dropped by 3.3 points from year-end 2024 and sits 6.8 points below the historical average, landing at 65.7. This is one of the lowest readings on record, with the index falling below this level only during the 2008 Global Financial Crisis, the COVID-19 pandemic and the post-pandemic inflation surge.

TCI drops 3.3 index points to 65.7, one of the lowest scores on record

Global trade continues to face multiple headwinds, and Canadian exporters are feeling the strain. Key findings from the summer 2025 survey include: 

  • Declining U.S. orders: 40% of respondents exporting to the U.S. reported a drop in orders over the past six months—a statistically significant jump from 16% in the year-end 2024 survey. Thirty-six percent expect declines over the next six months. 
  • Tariffs spillovers: 40% of exporting respondents anticipate negative impacts on domestic sales due to tariffs.
  • Financing challenges: Access to financing remains a top hurdle, with expectations of less favourable terms ahead.
  • Operational pressures: Respondents continue to face a mix of financial and operational challenges. Cash flow, rising business expenses and profitability remain top concerns. On the non-financial front, tariffs and global economic conditions figure prominently.

Exporters respond with resilience and diversification strategies

Despite the challenges, Canadian exporters are adapting. Strategies include:

  • Growing domestic sales
  • Diversifying into new markets
  • Sourcing locally to manage tariff impacts

Free trade agreement usage shows room for growth

From a trade diversification perspective, the use of free trade agreements (FTA) by exporting respondents appears to be uneven. The results suggest significant opportunity to increase FTA utilization among qualifying exporters:

  • 58% of those exporting to the U.S. use the Canada-United States-Mexico Agreement (CUSMA).
  • Only 34% of those that export to the applicable markets in the Comprehensive Economic and Trade Agreement (CETA) agreement currently use it.
  • Similarly, only 14% of those that export to applicable markets in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) report leveraging that FTA.

Canadian exporters are navigating a complex trade environment, including the impact of tariffs and evolving global dynamics. As they manage risk and build resilience amid ongoing disruptions, EDC is here to support Canadian businesses.

Discover how exporters are responding to rising costs, cash flow challenges and declining U.S. orders. EDC’s latest Trade Confidence Index reveals one of the lowest scores on record—find out what’s driving the decline and how companies are adapting through diversification and strategic shifts.

Read the full report for actionable insights.

Read the full report
Date modified: 2025-09-08

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