If Canada doesn’t step up its export game soon, the loonie could fall to 71 cents US in the 2020s, according to two CIBC economists.

“Simply put, export volumes have grown at a snail’s pace as plants shut their doors in Canada and opened elsewhere,” CIBC Capital Markets economists Avery Shenfeld and Royce Mendes wrote in a report released Monday.

Despite stronger exports and manufacturing output in recent months, the economists said Canada needs more facilities to help ramp up export capacity.

"What's been lacking are ribbon-cutting ceremonies at the new facilities — factories, labs and office towers — needed to expand export capacity," they said.

The report said Canada’s sluggish export growth has caused the country’s share of imports to the U.S. to drop to 13 per cent from nearly 20 per cent in 1999.  

The economists also noted waning Canadian auto production over the last two decades has resulted in fewer well-paying manufacturing jobs in the country.

“We’ll need to tread carefully in these [NAFTA] talks, lest the lack of lower-cost content in vehicles assembled in Canada make them uncompetitive against vehicles from overseas,” the report read.  

Shenfeld and Mendes added that while Canada’s lack of pipelines has been a hot topic recently, especially as Kinder Morgan’s May 31 deadline for clarity on the Trans Mountain expansion project approaches, that’s not the only issue hampering Canada’s ability to compete.

“Instead, the weaker elements have been a hodge-podge of manufacturing sectors which have in many cases seen Canadian activity supplanted in the U.S. market by Mexico or other low-cost competitors,” the economists wrote.

Shenfeld and Mendes suggested more education and targeted training, faster government approval for projects, and lower corporate taxes as remedies that would help improve Canada’s competitiveness.

“If we don’t make progress in tilting the playing field back to Canada, there is always the market’s invisible hand to do the work for us,” the economists said.

“A poor current account balance will, over time, tend to push the Canadian dollar weaker against other majors. That will particularly be true if, given an elevated household debt level, the central bank has to proceed more cautiously on rate hikes than the U.S.”