Trade commissioners become a potent force

Canadian businesses venturing into foreign markets face unfamiliar rules, customs and bureaucracies. Helping them navigate is the job of Canada’s trade commissioners, who have reinvented themselves as an aggressive consultancy for Canadian business.

Photo: KAZUHIRO NOGI/AFP/Getty Images

Not long ago, the trade commissioners, who work in more than 150 offices around the world, had a guaranteed flow of clients: Businesses that paid a call on commissioners abroad could receive a 50% subsidy for marketing themselves internationally. Then, a decade ago, that subsidy was cancelled, and the century-old Trade Commissioner Service had to prove itself all over again.

“We had to change our business model and convince companies we could work with them and help them succeed in whatever market they were interested in,” says Stewart Beck, Canada’s High Commissioner to India.

It did so by reaching out to business through educational events, by leveraging its contacts, by helping companies do their due diligence and, in the past three years, by offering expertise in high-growth sectors in which Canadian business is expected to thrive. Today the trade commissioners are hugely popular with business people, interviews with entrepreneurs and trade associations suggest.

In Beck’s view, government plays three key roles in helping business overcome barriers: “You’ve got to champion, you’ve got to be a catalyst and you’ve got to risk-mitigate.” Government-led trade missions and free-trade discussions fill those first two roles, but on a day-to-day, micro level, the trade commissioners play their part as well. Export Development Canada (EDC), a government export credit agency, helps mitigate risk by providing financing, guarantees and insurance.

What do the commissioners do? First, they help business become export-ready. Rather than just “sitting at embassies abroad” waiting for a phone call, their network of regional trade offices in Canada holds seminars and symposia, in collaboration with chambers of commerce or trade associations, says Jonathan Fried, Canada’s ambassador to Japan.

It helps to consider that international business is about partnerships for the two-way movement not only of goods but of technology, intellectual property, capital and investment, Fried says.

“Does one think only in traditional terms–‘I’ve got a product, I want to sell it abroad’–or is it a matter of thinking more comprehensively?” he says.

“I might want to export directly from Canada or, in partnership with the Japanese or other partner, produce or license my good in that foreign country. I might actually want my Japanese or other foreign partner to come participate in my company in Canada to help me benefit from what they might bring to bear, not only in terms of money but in technology, thus facilitating what I might be able to sell back abroad.”

Trade commissioners work with the Business Development Bank of Canada (BDC) and EDC, to help business people decide what to do. “First you have to assess whether the opportunity is real or not,” says Fried. “Then you assess who are the potential partners, either as investors or as purchasers of that good or service.”

The commissioners then help businesses make those contacts, whether directly or through trade shows. Small businesses “don’t hop on a plane for $5,000 or $7,000 just to explore,” says Fried. One way to minimize costs is to share space in a Canadian pavilion at a trade fair.

Businesses are also urged to think more broadly in geographic terms, Beck says. “You want to be able to convince a company that if you’re going to go to Tokyo, it makes sense also to go to Seoul and Taipei. The people working in ICT [information communications technology] in Tokyo talk to the people who are working in ICT in Taipei, who talk to the people in Seoul. So that the company may get a program for those three markets.”

The trade missions abroad know the local laws and practices, and help businesses navigate a maze of rules and bureaucracy, says Beck. “Part of the reason we have the network out there is to go out and meet the people and do the due diligence on potential partners. Canadians who come here rely quite heavily on the locally engaged staff at the high commission. They’re the ones who know the routes to manoeuvre within the country.”

In Japan, for instance, consensual decision-making takes a long time. “One needs to have patience in building that relationship, in providing information for due diligence to ultimately allow the Japanese firm to reach its consensus,” says Fried. Once that consensus is reached, “they will view that partnership as being in effect forever,” in good times and bad. He counsels patience and perseverance. “Sometimes the tortoise beats the hare. Your patience at the beginning is rewarded by long-term business.”

Of India, Beck says, the market opportunity is enormous, but “it’s not the easiest market in the world to do business. We have to do a bit of hand-holding to help companies through it.” It’s highly regulated, and “you can’t read a newspaper today without reading about corruption in India,” he says, though much of the corruption is “lodged in certain areas in the public sector.” In the private sector, “you come and work on the basis of Canadian values, and at the end of the day you’re respected for it.”