With geopolitical tensions reshaping supply chains, unilateral tariffs disrupting established trade agreements, and regulatory complexity increasing across regions, global business decisions carry more weight and risk than ever before.

According to the World Trade Organization, global merchandise trade volumes are projected to grow in 2026, but at a slower and more volatile pace than in previous decades, driven by geopolitical fragmentation and policy uncertainty. In other words: opportunity is there, but so is risk.

Against this backdrop, the most successful organizations are not asking whether they should grow internationally. They’re asking smarter questions about how.

1. What are some of the most important steps to take before venturing into a new market?

One of the most common mistakes in global expansion is reacting to opportunity before assessing readiness.

Before venturing into a new market, organizations should conduct a situational analysis, including assessing organizational readiness and planning and analyzing the results of international market research. This is not simply a planning exercise, it is a risk filter.

As the guide explains, “Before an organization embarks on a new initiative in international trade, it is important to assess the organization’s current conditions, attitudes, and resources”. This assessment helps determine whether the initiative is feasible and whether the potential gains justify the exposure.

Companies that skip this step often become reactive exporters, responding to inquiries without clear strategy or trade expertise. In today’s environment, readiness is a competitive advantage.

2. What international market research do you need to do before expanding into a new market?

International expansion demands structured research, not guesswork.

The guide outlines a seven-stage approach to international market research, beginning with defining the research objectives and progressing through stages such as screening potential markets, selecting the research design and data sources, and ultimately presenting conclusions to then apply the research. Each stage reinforces disciplined decision-making.

Beyond methodology, macroeconomic indicators play a critical role. The guide highlights key data points including Gross Domestic Product (GDP), GDP per capita, Household Disposable Income, market size, unemployment rate, population, and inflation rate. These metrics help businesses evaluate market suitability and purchasing power before committing resources.

In other words, expansion decisions should be evidence-based—not optimism-based.

3. How do tariffs introduced unilaterally by the U.S. government affect trade between Canada, the United States, and Mexico, even with CUSMA in force?

North America illustrates how quickly trade conditions can shift.

While CUSMA is designed to facilitate trade, recent unilateral tariff actions by the U.S. government (2025) have disrupted this predictability. Businesses that once relied on stable, tariff-free access have faced sudden cost increases and regulatory uncertainty.

As a result, companies must assume volatility. The guide notes that businesses must assume the possibility of future, unexpected tariffs and plan accordingly. Practical strategies include diversifying supply chains, strengthening trade expertise and maintaining contingency plans.

The broader lesson extends beyond North America: formal agreements do not eliminate political risk. Professionals must remain agile and informed.

4. What integrative export and FDI approaches can businesses employ when expanding into Asia?

International growth is not limited to exporting finished goods.

Organizations can expand through export, international transfer, international partnering, or through FDI. Within these pathways are multiple approaches: indirect export, direct export, licensing, franchising, strategic alliances, representative offices, greenfield investments and mergers and acquisitions.

Each model carries different levels of investment, control and exposure. For example, the guide explains that Greenfield/Brownfield investing is the riskiest and most expensive market expansion option. Conversely, indirect export may limit risk but also reduce market visibility and control.

Selecting the right strategy requires alignment between organizational capacity and long-term objectives. There is no universal blueprint, only informed decision-making.

5. When a company expands into a new market, how important are cross-cultural considerations?

Market entry is not only about economics and logistics. Cultural alignment can determine success or failure.

The guide emphasizes that understanding and adapting to cross-cultural differences is critical for success. Communication styles, consumer behaviour, marketing imagery and negotiation practices can differ significantly between markets. Ignoring these nuances risks damaging relationships before they begin.

Cultural intelligence reduces friction, accelerates trust-building and strengthens long-term positioning.

6. How are tariffs determined on products that are being exported?

Amid strategic discussions, technical fundamentals remain essential.

A tariff is the rate that is used to determine the amount of duty that will need to be paid to the government of the importing country when goods are shipped internationally. Tariffs are determined using the Harmonized System (HS) of nomenclature, an internationally standardized coding system. Many governments have online tools for importers and exporters to determine and obtain a HS code for their materials and products.

Accurate classification directly affects cost, compliance and clearance timelines. Errors can lead to delays, penalties or reputational damage. For international professionals, understanding these mechanisms is not optional, it is operational risk management.

A more disciplined approach to global growth

Across regions, from the United States to China, the Middle East and the Caribbean, the opportunities are real. So are the risks. Regulatory unpredictability, infrastructure differences and currency considerations all influence outcomes.

As the guide concludes, a well-informed and adaptable approach is central to long-term success.

For professionals navigating global markets today, the essential questions are not simply “Where can we grow?” but:

• Are we prepared internally?
• Do the macroeconomic fundamentals support entry?
• What risks exist within the regulatory and political landscape?
• Which market entry model aligns with our capabilities?
• Do we understand the cultural and compliance dimensions well enough to execute effectively?

Exploring these questions in greater depth, along with region-specific insights and practitioner perspectives, can help organizations move from reactive expansion to structured global strategy.

For readers interested in examining these issues further, the Essential International Trade Questions Answered guide offers additional context and practical insight drawn from experienced international trade professionals.

The post 6 Essential questions every international business professional should be asking before they go global appeared first on Trade Ready.

Editor’s note: This content was last updated May, 2024. There are ongoing developments in the trade relationships between CUSMA members that are not reflected in this article.

In July 2021, Mary Ng, Canadian Minister of Small Business, Export Promotion, and International Trade, along with Tatiana Clouthier, Mexico’s Secretary of Economy, and Katherine Tai, United States Trade Representative, marked the one-year anniversary of CUSMA, also known as the Canada-United States-Mexico Agreement. This historic all-female gathering took place in Mexico and saw all three women converge, in person, to mark “their commitment to North American supply chains and economic competitiveness, which have created significant economic growth and benefits for people and workers in all three countries,” according to the official Trilateral Joint Statement.  

New 2023 Trilateral Joint Statement

For many, the acronym CUSMA is still not second nature—even prompting some to refer to it as the “New NAFTA” (the North American Free Trade Agreement) or “NAFTA 2.0,”—and there are many reasons for this. For starters, the countries that are part of CUSMA each refer to it differently, with the U.S. calling it “USMCA” and Mexico often calling it “T-MEC.” Beyond the name, the details surrounding CUSMA aren’t as clear-cut as they were with NAFTA (which came into effect January 1st 1994), prompting many questions about the trade agreement that have yet to be answered to this day.  

To understand what CUSMA is, the history leading up to its enactment, and where it stands today, read on below: 

What is the Canada, United States, Mexico Free Trade Agreement (CUSMA)?

Many refer to CUSMA as the “New NAFTA” or “NAFTA 2.0” because it is largely a revised version of NAFTA. Similar to NAFTA, it is a free trade agreement between Canada, the United States and Mexico that defines the National Treatment and Market Access for Goods between the countries, determining rules and regulations on tariffs, rules of origin, customs administration, trade facilitation, and many other trade-related matters.

The CUSMA trade agreement covers a long list of items, from agriculture and textiles to regulatory matters such as government procurement, macroeconomic policies, Intellectual Property (IP) rights, and rules for Small and Medium-Sized Enterprises (SMEs). 

The tumultuous history of CUSMA 

CUSMA was created at the insistence of former U.S. President Donald Trump. He was outspoken about his dislike of NAFTA during his presidential campaign and pushed for a new trade agreement that favoured American interests—even going so far as to threaten to terminate the agreement altogether if the other countries did not acquiesce to a new agreement. Unsurprisingly, the negotiations for many of these changes were tense, and leading up to the signing, the U.S. increased the tariffs on specific imports from Canada to the U.S., causing Canada to do the same in retaliation. Mexico also had criticisms of the trade deal agreement in many areas.  

Eventually, CUSMA was ratified on March 13, 2020, with Canada being the last country to ratify. Following this, the agreement officially came into effect on July 1, 2020. In a State of the Union Address, former President Donald Trump said of the agreement, “The USMCA will create nearly 100,000 new high-paying American auto jobs, and massively boost exports for our farmers, ranchers, and factory workers. It will also bring trade with Mexico and Canada to a much higher degree, but also to a much greater level of fairness and reciprocity.” Meanwhile, critics noted that Canada, in particular, was consistently treated as an “enemy” instead of a partner throughout the negotiations. 

What were the main changes in CUSMA? 

To ensure that the new trade agreement was beneficial for all, the participating countries used the new trade agreement as an opportunity to revise items from NAFTA, adding new sections on digital trade, labour, the environment, and small and medium-sized businesses.

Additionally, there were increased incentives for automobile production in the United States, a higher duty-free limit for Canadians who buy goods from the U.S. online, and greater access to the Canadian dairy market from the U.S.—a move which has had large financial repercussions on the Canadian dairy industry. However, many see the provision on labour, especially for workers’ rights in Mexico, as largely positive and progressive. 

How is CUSMA doing today? 

The views on CUSMA’s impact in North America one year after it came into effect are varied. Many, especially those with U.S. interests, view it as a success, while critics say that other countries were forced to make unfavourable agreements. Currently, there are disputes in several areas including labour rights violations in Mexico and a USMCA dispute panel has been initiated over dairy tariff rate quotas (TRQs) applied by Canada. 

Learn more about trade tariffs and quotas in our FITTskills course, Feasibility of International Trade.

To complicate the matter, COVID-19 delayed the implementation of many CUSMA measures, with all countries focusing their efforts on pandemic relief. As such, much of the impact of CUSMA remains to be seen, though, initial predictions found the economic impact to be modest, with Global Affairs Canada projecting that Canada would benefit from CUSMA by 0.249 percent of GDP by 2025 when compared to a scenario without NAFTA in play. 

In a news release on the Government of Canada website, there were noted next steps for CUSMA, including the following: 

“As our countries continue to combat the COVID-19 pandemic and continue our shared recovery from an economic downturn that has disproportionally impacted SMEs and underrepresented communities, we recognize that the CUSMA has an important role to play in revitalizing our region. As we continue implementing the CUSMA and ensuring that this Agreement benefits those that have historically been left behind by trade agreements, the Parties have agreed to continue to hold engagement meetings with underserved communities and to hold a Trade Deputies meeting before the end of this year to assess progress on the areas highlighted today and identify ongoing opportunities for future engagement.” 

CUSMA and SMEs 

CUSMA’s chapter on small- and medium-sized commercial goods businesses could be very beneficial for these businesses. The CUSMA additions for SMEs are moving forward with items like establishing a committee that will study how small businesses engage in trade and determining how SMEs in all countries can benefit from the agreement.

This is especially important now, as many SMEs have suffered great financial losses due to the pandemic. 

Perhaps on future anniversaries of the agreement, SMEs in all three countries may conclude that the true legacy of CUSMA  is that it serves as a catalyst for equitable growth, a model for competitiveness, and a stoke for innovation while also protecting the shared environment in North America.

Decision No. 5 of the FTC of the CUSMA, T-MEC, and USMCA

In February 2023, the Free Trade Commission (FTC) sought to enhance coordination and consultation to support the region’s trade flows in times of emergency, acknowledging how such situations can harm North America’s domestic economies. As such, the FTC required the participating countries to identify relevant agencies or maintain domestic committees to ensure that trade isn’t disrupted, or at least only minimally affected, by emergency situations.

In such events, the United States, Canada, and Mexico must also proactively consult and coordinate with relevant industries and non-governmental stakeholders (including workers) who may be involved, and inform them promptly of important mechanisms on a free and public website for transparency.

The FTC also set to establish a Trilateral Coordination Sub-Committee on Emergency Response to handle the delivery of information and the coordination of activities related to matters affecting trade during an emergency. Each country must designate a contact point for the Sub-Committee, which shall be endorsed to the other countries, and provide information on domestic procedures for emergency responses. The Sub-Committee must then reconvene annually to discuss comprehensive risk management as they see appropriate.

The FTC also directed the North American Competitiveness Committee, through its Sub-Committee, to develop a proposal on procedures for coordination and consultation during specific emergency events. It was also tasked to establish a trilateral Working Group to share each country’s approach to defining and protecting critical infrastructure under CUSMA and to reconvene periodically to update reviews and reports and to make any modifications as appropriate.

In all this, the FTC emphasized the importance of labour rights and worker health and safety, especially in emergency situations. The Sub-Committee must ensure the protection of these while maintaining trade flows.

The Latest on CUSMA in 2023

Three years after CUSMA entered into force, North America has felt the effects of the agreement. These were discussed in the third meeting of the T-MEC/USMCA/CUSMA (Agreement) FTC on July 7, 2023, in Cancun, Mexico.

The last two years have seen aggressive steps towards increasing dynamism and competitiveness in the region, particularly through trilateral workforce development events held in all three participating countries. These gatherings are expected to continue as they present an opportunity for each country to exchange best economic practices and explore solutions to regional and national challenges.

SMEs continue to be a hot topic, as organizations push these businesses (primarily indigenous organizations) to actively participate in international trade, as facilitated by CUSMA.

Workers’ rights are also increasingly emphasized as the agreement highlights a commitment to uphold these, including freedom of association and collective bargaining rights. In relation, CUSMA leaders are taking steps to ban the importation of goods produced by forced labour consistently, and to give labour stakeholders (particularly those in Mexico) a voice in trade policies.

CUSMA plays an important role in empowering North American economies, and with occasional reviews and assessments, it’s expected to continue to bring benefits and opportunities to the United States, Canada, and Mexico.

The post What is CUSMA? An overview of the trade agreement appeared first on Trade Ready.

Despite global trading tensions and worries over recessions, Canadian exporters and investors had expressed confidence in foreign trade by planning to increase both foreign exports and foreign investments in the near future.

However, those plans, reported in Export Development Canada’s (EDC) year end Trade Confidence Index (TCI), have been cast into uncertainty as coronavirus disrupts international travel, cuts off trade pipelines, and causes global markets to plummet.

Guide: How COVID-19 delays could affect your supply chain from contracts to insurance and custom clearance

While immediate plans for increases in foreign investment and export may be uncertain – Canadian exporters to China, for example, have already seen disruptions –EDC continues to be optimistic, saying disruptions should be short term and the markets resilient.

Businesses reported plans to increase exports and investments

Before coronavirus outbreak, 51% of the 1,000 businesses surveyed for the TCI said they expect exports to the United States to increase in the next six months, and there had been an increase in foreign investment by Canadian exporters in 2019 overall. Investments in other countries has risen from 14% in 2012 to 17% in 2019.

Ten percent of businesses reported that they plan to invest abroad in the near future. The United States continues to be the target of Canadian exporters and investors.

Currently, 91% of the responding businesses are exporting to U.S., followed by 17% to the U.K., 15% to Mexico, 15% to China and 14% to France. For those planning to export to new markets, 67% planned to export to the United States, 12% to France, 8% to China, 8% to Japan and 7% to the U.K. The story is similar for Canadian businesses investing abroad: United States is the overwhelming destination for foreign investment, with 64% of businesses currently investing in the United States, 12% in China, 8% in the U.K., 8% in Mexico and 7% in Germany. Of those planning to invest abroad, 68% to the United States, 11% to China, 7% to Germany, 6% to India and 5% to Mexico.

How will the coronavirus pandemic disrupt those plans?

In its Q1 predictions, EDC predicts that coronavirus outbreak impacts won’t extend into the last two quarters of 2020.

Additionally, EDC predicts that any ground lost by businesses will be regained as travel bans are lifted and supply chains are restored. Those predictions are based on previous outbreaks, such as SARS and H1N1, which also dramatically interrupted markets and trade. In those cases, markets showed that they were able to rebound quickly from the sudden shocks of business closures, interrupted supply chains and decreased economic activity.

When it comes to moving forward with growth plans and current operations, EDC advises Canadian exporters and foreign investors to continue to do business and execute their plans.

At the same time, EDC advises, businesses should be aware of any changes in foreign regions that could cause disruptions. EDC, meanwhile, said it will continue to work on broadening foreign markets for Canadian businesses, even to areas impacted by coronavirus.

Before coronavirus, concerns over global recession eased

When surveyed about a global recession before the coronavirus outbreak, businesses said they were less concerned that a recession was imminent. When asked in mid-2019, 41% of businesses reported concerns that a global recession would hit in 2020. That number had dropped to 26% by then end of the year, and 35% of respondents said they didn’t expect a global recession before 2022.

This shows that based on what they’re seeing in their own businesses, Canadian exporters and investors expected markets to remain steady for the time being. While tumbling global markets could fuel concerns for some businesses, EDC said markets should prove resilient, as demand to meet global human need remains the same regardless of the outbreak.

While some businesses likely will see temporary drops in demand that harm cashflow, EDC said short-term emergency loans and government aid should help to alleviate constraints and enable businesses to recover when demand resumes.

CUSMA could mean good news for exporters

Once coronavirus border constraints lift, Canadian exporters and investors could see some positives with the passage of the Canada-United States-Mexico Agreement (CUSMA). The agreement, meant to replace NAFTA, was quickly ratified by the Canadian Parliament March 13th. The number of respondents with a negative view of CUSMA dropped from 34% to 16%; 62% of respondents had a neutral view of CUSMA, and 22% had a positive view.

Additionally, while the primary concern cited by businesses was international protectionism, the CTI reports that businesses don’t feel that they have been influenced or negatively impacted by international trade tensions. In the survey, 70% of businesses said their concerns had not influenced their export or international investment strategies. Additionally, 54% of respondent said the trade tensions between the United States and China had not impacted their businesses, and 12% of businesses said they have positively been impacted. Sixty-seven percent said they had not been impacted by trade tensions between China and Canada, and 6 % said they have seen positive impacts.

Trade confidence beyond coronavirus

Undoubtedly, the outbreak of the coronavirus pandemic has disrupted trade markets, along with the entire economy, in a way that is sure to have shaken trade confidence.

Before the outbreak, the TCI delivered quite a bit of good news, as an increased number of exporters and investors had widened their footprint in foreign markets, and more businesses expected to follow suit. Businesses also said they have not been hurt by trade wars and expect positive effects from the ratification of CUSMA.

While coronavirus adds a great deal of uncertainty, EDC said international businesses shouldn’t be overly alarmed. The effects of the pandemic should be over by the second half of this year, EDC said, and businesses and markets should rebound quickly.

As businesses move beyond the pandemic, there is the potential to move forward with growth plans and see a positive end to the year.

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