As Canada’s 43rdParliament prepares to convene, the third season of Before the Bellkicked off by assembling a panel of experts and stakeholders to explore the issues that Canadian small businesses face as they seek to expand into global markets. Forty-one percent of Canadian exports are shipped by small and medium-sized enterprises, but with all three of our largest trading partners – the United States, China and UK – we are dealing with uncertainty in an un-ratified USMCA, strained China relations, and Brexit.
During the Pulse segment of Before the Bellwith co-host Derick Fage, Amy Karam, global competitive strategist with Karam Consultingand author of The China Factor, said that while the federal government has many programs to help small and medium-sized businesses and has done a good job of streamlining of those programs, they still need to work harder. Canada’s Trade Commissioner Service, for instance, which was boosted during the first Trudeau term, needs to provide longer-term support.
“In talking to the SMEs, they are point-blank saying I need [trade commissioners] to help me find the contact on the ground in India or in the Philippines, or wherever, and I need you to be on the ground and be that virtual partner for me in the business,” said Karam. “And they do some of that with the introductions, but it’s taking them past that first mile and into the twenty-six-mile marathon because international markets are a very long life-cycle.”
W. Scott Thurlow, lawyer and past president of the Renewable Fuels Association, said that when Parliament returns and the USMCA ratification agreement bill is tabled, the Conservatives will be in a tough spot if they hope to oppose the bill in hopes of a better deal.
“It’s incumbent on the Liberals to reach across the aisle to ensure that someone will support it, and I would imagine that a reformulated NAFTA would be in Quebec’s best interests, so there is another avenue for support, particularly because of the cultural protections embedded in it,” said Thurlow.
Sarah Goldfeder, principal with Earnscliffe Strategy Group, says that Canada has a moment of opportunity as the U.S. retreats from the global stage, particularly on trade issues, and with China not playing well with others.
“You have Canada well-positioned with relatively new trade agreements to take advantage of that,” said Goldfeder. “Every single one of those trade agreements, including the USMCA, has a section on small and medium-sized enterprises, so you have all of this opportunity to take government policies, and support the SMEs as they try to figure out these trade policies because frankly, international trade isn’t easy.”
During the Policy segment with Sixth Estatepresident and host Andrew Beattie, Corinne Pohlmann, senior vice-president of national affairs and partnerships with the Canadian Federation of Independent Business, said that election promises like the elimination of swipe fees for small businesses are important for small merchants across the country.
“When it comes to other initiatives like putting money into start-ups, financing is always a big part of a small business’ ability to thrive,” said Pohlmann. “The thing is those programs tend to be very focused and can only benefit a certain proportion, but we need to make sure that the broader financing climate is available.”
Pohlmann added that interprovincial trade barriers can act as a discouragement to those SMEs trying to trade internationally.
Joy Nott, partner with KPMG, said that while businesses crave stability, there is not a lot to be found with our traditional trading partners right now, adding that the other trade agreements Canada has with large economies offer opportunities. She cited a first-mover opportunity in Japan.
“If you’re looking for certainty, there are options other than the United States, China, and the UK,” said Nott. “What makes it difficult for a lot of companies, especially smaller ones, is we have these established relationships that have been in place, and that Trade Commissioner Service is so invaluable to the Canadian business sector. While it’s getting better, the Trade Commissioner Service is still one of the best-kept secrets in Canada.”
Nott added that if companies are looking to re-tool their supply chains in the current environment, that also gives them an opportunity to make their operations greener at the same time.
Catherine Decarie, senior vice president of channels and marketing with Export Development Canada, said that when it comes to global reputational rankings, Canada is number one for the sixth year in a row. For small businesses who are hesitant about trade, they need to take advantage of the fact that the Canadian brand is so strong at the moment.
“Companies that are involved in trade actually have greater revenues,” said Decarie. “They make more money, they grow more, they have more jobs, they’re more innovative, and they’re more nimble and resilient. The more we diversify the countries with whom we trade, the more we’re able to withstand any shock that might occur in the economy.”
Watch the full episode below.