Canadian Businesses Must Plan For a Change
The NAFTA renegotiations are coming to Canada in a few short days. And, as KPMG says “With no substantive progress being made on the key issues in the NAFTA renegotiations, businesses need to start working on backup plans”.
As a manager of a Canadian Business, don’t wait around crossing your fingers for the renegotiations to hopefully work out for your business. Shift is happening now in the business world. It’s time to shift or get off the pot!
A recent article in The Globe and Mail points out there are three logical scenarios right now, none of which has a good outcome.
- A deal is reached by early 2018 like every one hopes. Due to the long approval process in the States, approvals don’t even reach congress until 2019. By then, a new Mexican government is in place, and even if congress approves, it likely would have concessions from Canada and Mexico.
- Trump makes good on his promises and pulls out of NAFTA without congress approval. This would result in lengthy court battles and needed law changes. In the meantime, markets will be unsettled with so much uncertainty overhanging Canada-U.S. business relations.
- Negotiations collapse and further talks are suspended. Bilateral trade under the NAFTA umbrella goes on. But the White House puts intense pressures on Canada and the US and starts imposing trade restrictions in hopes of pressuring the 2 countries to resume talks.
It is obvious in any of the above scenarios that the status quo will no longer be an option for Canadian business. While it seems like the hopes of getting a new NAFTA any time soon are going down the drain, Canadian Businesses should feel empowered to look for new opportunities. Just because there is a shift, doesn’t mean you have to flush all your organization’s hard work down the toilet and start again. It just means that it’s time to look for other opportunities and understand who you need to sit down with to position your organization correctly to gain market share.
For example, the Canadian-European Union Comprehensive Economic and Trade Agreement (CETA) provisional application will be coming into effect tomorrow. And, as the Toronto Region Board of Trade’s World Trade Centre suggests ‘Countries such as Britain, France and Germany should become key markets for Toronto-area small- and medium-sized businesses looking to grow – and key destinations for future trade missions by politicians.’
How you react to the inevitable change will determine the future of your company. If you are ready to take the plunge and plan for your organization’s future without stalling current operations you need to act now.
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