TORONTO — The new American President and Congress aren’t alone in their protectionist sentiments, according to a UPS-sponsored survey of small and medium sized (SME) businesses in Canada.

Lots of Canadians would like to back off of free trade, too. Problem is, they don’t seem to get that that there’s zippo evidence that closed borders enhance a country’s economy.

UPS, in conjunction with the surveyors TNS Canadian Facts, surveyed more than 500 SMEs across Canada in November and December — before the Buy American measures in the stimulus bill and the latest ON TIME foreign freight fee proposal  — and UPS President Steve Flowers reported on the results in an online seminar this week.

More than half of the survey respondents, he said, are comforted by trade barriers. And most of the protectionists were in the construction, manufacturing and retail sectors.

"There has been a lot of hand wringing recently in the Canadian media in response to the ‘Buy America’ clause, but the truth is that the protectionist sentiment is just as prevalent among the grassroots here in Canada," he said.

“These views are not unexpected given the current recession. The natural instinct among SMEs and business in general is to shelter the market from outside forces over which we have little control."

Flowers noted that closed borders are exactly what the federal government is not working towards and protectionist sentiments very clearly run against Ottawa’s ongoing efforts to engage Columbia, Japan, India and the European Union on the possibility of entering into free trade agreements with Canada in the near future.

Flowers added that economically, protectionism is a fiscal hound that just don’t hunt.

Despite the desire to stay home, trade habits
are hard to break, notes a new UPS study

"Historical data shows that market diversification through international commerce will serve to strengthen profitability and competitive advantage much more than putting up more restrictions and barriers to trade," he said.

Still, even in the face of declining continental business opportunities, it’s clear that traditional trade habits are hard to break.

The study also revealed 65 percent of SMEs intend to target the U.S.’s shrinking consumer market, compared with only 19 percent who intend to take advantage of Asia’s emerging new middle class and 38 percent who intend to target Europe.

South of the border, 42 percent of SMEs predict growth in trade between Canada and the U.S. over the next three years. In comparison, 48 percent predict similar growth between the US and Asia Pacific and 42 percent predict future trade growth between the U.S. and Latin America.

In Canada, SMEs’ reluctance to engage in international trade "stems from an ongoing and widespread state of inertia," with 49 percent of respondents claiming they have enough business to deal with in Canada. U.S. respondents on the other hand, cite a limited knowledge of the global marketplace as their biggest stumbling block.

Sentiments against globalization are much more rampant south of the 49th parallel where one-third of U.S. respondents said the shrinking global village is detrimental to business, while an equal number described it as beneficial, notes the study.

Conversely, in Canada 45 percent of businesses viewed global trade as a positive development for their business and only 9 percent saw it as detrimental.

(The newest March issue of Today’s Trucking magazine features a story by about Barack Obama rattling his protectionist keys).
In the meantime, Flowers’ presentation will be available here.