Thriving export sectors are crucial for the province's growth and prosperity. Expanding the export base is the best way to consistently grow per capita GDP and incomes for a small trade-dependent economy. Moreover, building and sustaining a suite of commercially successful export industries is the only way a small jurisdiction like British Columbia can pay for the vast array of imported goods and services that support a high quality of life.This report provides an in-depth analysis of B.C.'s export strengths and looks ahead to future opportunities for growth. In it, we distill hundreds of individual export industries into ten broadly defined export sectors to provide a conceptual framework for understanding B.C.’s export base and what underpins prosperity in the province.

Report highlights

The framework underscores the outsized role that natural resources continue to play in the B.C. economy. The forestry, energy, mining and agriculture sub-sectors together account for 45% of B.C.’s international exports.The framework also illuminates the diversity of the province’s export economy. Services account for about 45% of B.C.’s international exports, a notably higher proportion than in other provinces (Ontario ~30% and Alberta ~18%). This mainly reflects B.C.’s larger transportation services, film and TV, tourism and education export sectors.About 10% of B.C. exports come from the non-resource manufacturing sector, which itself is comprised of an array of different products.Our updated estimates suggest that in 2022, B.C.'s international exports reached $83 billion. This is a $19 billion gain over the five-year period (2017-2022), equivalent to a 39% increase in export receipts.

• The energy sector stands out, owing to its massive $7 billion export gain (80%).

• B.C.’s non-resource manufacturing exports increased by $2.6 billion (+41%) over the period, putting it among the sectors providing the largest lift to export earnings.

• Professional services exports expanded by an impressive $2.4 billion.

• The dual-role gateway services sector added another $1.9 billion in exports (+33%).

• Technology services exports recorded the strongest growth rate of any sector over 2017-2022 ($2.6B or 150%).

International tourism exports plunged by as much as $5 billion during the pandemic and had only partly recovered by 2022. Even as export earnings from international tourism continue reviving in the next 2-3 years, our analysis points to the magnitude of the pandemic’s impact on this important source of export earnings.The significance of the B.C. energy sector is inescapable. Energy exports have risen by billions and are poised to rise by billions more when LNG production begins later in the decade. Our estimates and projections suggest energy products and services will account for one quarter and possibly as much as 30% of the overall increase in B.C.’s exports between 2017 and 2027. The carbon tax is of particular concern and puts B.C. exporters at a distinct disadvantage. The reform of B.C.’s carbon pricing system is essential to improve the competitive foundations for some of our leading and relatively lower carbon-intensive export sectors. Any credible strategy to grow per capita GDP and average household incomes in B.C. must be built around supporting and expanding the province’s exports. The best way to do this is to establish policy and economic conditions that encourage growth across B.C.'s export industries.

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Key Takeaway

Policy makers should embrace the reality that growing exports is aligned with the goal of having more B.C. companies scale in size, lifts productivity, supports real wage growth, and enables stronger real per capita GDP growth. They also should recognize that all else equal, when B.C. exports displace similar commodity exports from other jurisdictions, global carbon emissions are likely to be lower. This reflects the relatively low carbon content of B.C. traded goods.