News Analysis: Weak Canadian dollar benefits national economy in long run

The Canadian dollar continued its downward spiral on Thursday, falling to a new low of 80.39 cents to the U.S. dollar, dragged down by plunging oil prices -- one of Canada's key exports.

Just last week, the Canadian dollar touched a six-year low compared to the U.S. dollar, and it has fallen by roughly 9 percent since January. Less than two years ago, the Canadian dollar was on a par with the U.S. dollar.

A devalued dollar makes imported goods more expensive for Canadians, and falling oil prices threaten the livelihoods of oil workers in the oil-producing province of Alberta. But it also comes with a silver lining for other industries and other parts of the country.

Giovanni Galipoli, economist at the University of British Columbia, said the weak Canadian dollar, though negatively influencing the Canadian oil industry as a whole, is good for the economy of British Columbia.

"This might actually be a good thing in the long run, because what happens is that this helps the Canadian economy rebalance. Resources are moving from one sector that is a kind of suffering to other sectors that can take advantage of it," Galipoli told Xinhua in a recent interview.

To be more specific, a weak dollar attracts more foreign tourists and Canadians tend to spend holidays inside the country to avoid losing money on a poor exchange rate.

Maya Lange, vice-president of a travel company known as Destination British Columbia, said the low Canadian dollar would definitely benefit tourism in the province.

In 2014, British Columbia saw a 3 percent increase in the number of American visitors. Tourism officials expect more Americans and overseas tourists this year.

"We think it will be a banner year. Results from last year were very positive. We're very confident that this year will also be a record year," Lange told Xinhua.

Schools and universities could also see a surge in the number of foreign students who come to Canada for diplomas and degrees.

"It's definitely an encouragement for international students when parents are getting more bang for their dollar. The current lower dollar enhances enrolment," said Toby Chu, CEO of CIBT Education Group, a company which operates several schools in the Vancouver region and recruits large numbers of students from overseas.

On the other hand, local experts were cautious about how far the dollar would fall.

"Nobody really knows if we've seen the bottom, but I don't think so. I think these things carry some momentum. So you can actually overshoot on the way down as you can overshoot on the way up," Galipoli said. Endi