The Future of Work … is Borderless

Back to 2021 HSBC Navigator: The Voice of Business

Supply chain challenges are temporary, but global opportunity is endless.

Canada is one of the world’s top trading countries with 14 free trade deals signed -- opening doors to 51 nations and granting access to 1.5 billion consumers that make up 60 per cent of the world’s GDP. But after nearly two years of border closures and an ongoing supply chain crunch with no end in sight, many Canadian business leaders appear to be losing confidence in their prospects beyond their own borders.

In fact, the 2021 HSBC Navigator: The Voice of Business report revealed that less than a third of Canadian businesses (29%) say they’ve increased the number of international suppliers they work in the past year, compared to 36% of global companies polled. Added to that, only one-in-10 (12%) Canadian businesses expect international trade to become easier over the next year – a significant decline from the 20% of leaders globally that expect things to get easier.

Even with borders reopening and enviable trade deals in place, it’s clear that many Canadian businesses may be comfortable focusing on shoring up their supply chains at home at the expense of pushing further into markets around the world. But while that may lead to short term peace-of-mind for some, it presents further risks for the future.

After the myriad trade concerns experienced during the pandemic, and with more supply chain challenges to come, it is clear that many Canadian leaders may be feeling fatigued about international trade. However, a short-term reshuffling to more focus on working with and selling to those close to home shouldn’t come at the expense of long-term opportunity – particularly when businesses in other global markets are positioning themselves to take advantage of a lack of competition from Canadians, says Alan Turner. Companies that take a strategic approach to pushing forward internationally today could ultimately reap the benefits of that head start a little further down the line.

With an unmatched global footprint and strong presence across Canada, HSBC Bank Canada can help Canadian companies regain confidence on the world stage.

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Ease of international trade infographic 12% vs 20%

  • Deep freeze on trade: Only 12% of Canadian businesses believe international trade will get easier over the next year, compared to 20% globally
  • Slow growth beyond the border: Only 29% of Canadian businesses say they’ve increased the number of internal suppliers they work with compared to 36% of their global peers.

Highlights

Changes to the current de minimis could lead to greater competition for Canadian e-commerce businesses.

New auto manufacturing stipulations could lead to greater production remaining in Canada – and greater costs for the end consumer.

While CUSMA may not entirely rewrite the rules of Canadian international trade, it does bring new considerations and a refreshed need to understand their impact on cross-border business.

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