A Commentary by Daryl Ching
When I advise founders on selling their companies, one lesson comes up every time: the strongest negotiating position comes from optionality.
The fastest way to increase urgency, improve terms, and raise valuation is not to convince a buyer how much you need the deal. It is to show that other credible offers exist. Even if no alternative transaction ultimately closes, the presence of competing interest immediately changes the psychology. Buyers move faster. The tone shifts. Compromise becomes more likely.
That same dynamic helps explain why Canada’s recent and upcoming trade outreach matters more than it might appear at first glance.
When Donald Trump came into power, Canada entered negotiations from a position of visible constraint. Our dependence on the US market was clear, and there was little indication that Canada had realistic alternatives. In that context, tariff threats and public hardline tactics were effective precisely because Canada appeared to have no other dance partners. The imbalance allowed Trump to dictate tone and, at times, terms.
That backdrop is essential to understanding the current moment.
Canada’s re-engagement with China marked the first visible shift. Regardless of where one stands on the merits of that relationship, the signal was unmistakable. Canada was willing to explore economic relationships beyond its traditional orbit. That signal was then reinforced by Mark Carney’s planned engagements with India and Australia in March, two large, strategically important economies with deep ties across the Indo-Pacific.
The immediate question is whether any of these conversations result in concrete trade agreements. The more important question is what they signal. In any negotiation, the party perceived to have no alternatives is the easiest to pressure. The moment credible options appear, leverage begins to shift.
Trump’s renewed tariff threats look less like confidence and more like a bid to preserve leverage. In M&A, this is the moment when a buyer, worried about competing offers, pushes hard for exclusivity. The objective is not better terms, but to shut down alternatives. Canada’s outreach to other trade partners challenges the assumption that it has nowhere else to go, and tariff threats may be aimed at stopping that momentum before it reshapes the negotiation entirely.
Trump has always approached negotiations transactionally. He responds to positioning and leverage more than appeals to goodwill or shared values. From that perspective, Canada engaging seriously with China, India, and Australia does not weaken its relationship with the United States. It strengthens Canada’s hand within it.
This balance between signaling strength and managing friction was also evident in Carney’s recent speech at Davos. He won the room, earning a standing ovation and reinforcing his credibility with a global audience. At the same time, parts of the speech appeared to unnecessarily antagonize Trump. It is not obvious that poking the bear was required to make the point or to win over the crowd. The message may still have achieved its objective, but it raises a fair question about whether the same impact could have been delivered without adding friction to an already sensitive negotiation.
It is important to be clear about what this strategy does and does not imply. Canada is not abandoning its most important trading relationship, nor is it choosing sides in a broader geopolitical contest. The United States will remain Canada’s dominant economic partner for the foreseeable future. Diversification is not replacement. It is insurance.
In a sale process, a buyer often becomes most aggressive when exclusivity is no longer guaranteed. The risk of losing the deal sharpens focus. Tariff threats can serve a similar function in trade negotiations. They test resolve and probe whether the other side truly has alternatives.
Canada does not need to finalize every new trade discussion to benefit from them. The signal alone changes the dynamic.
As Carney heads to India and Australia following renewed engagement with China, Canada has now put those options clearly in view. That alone may prove to be its most effective leverage.
Trump Negotiates on Strength. Canada Is Finally Showing Some
Managing Partner at Vistance Accounting, as seen on BNN Bloomberg, Globe and Mail and Financial Post
A Commentary by Daryl Ching
When I advise founders on selling their companies, one lesson comes up every time: the strongest negotiating position comes from optionality.
The fastest way to increase urgency, improve terms, and raise valuation is not to convince a buyer how much you need the deal. It is to show that other credible offers exist. Even if no alternative transaction ultimately closes, the presence of competing interest immediately changes the psychology. Buyers move faster. The tone shifts. Compromise becomes more likely.
That same dynamic helps explain why Canada’s recent and upcoming trade outreach matters more than it might appear at first glance.
When Donald Trump came into power, Canada entered negotiations from a position of visible constraint. Our dependence on the US market was clear, and there was little indication that Canada had realistic alternatives. In that context, tariff threats and public hardline tactics were effective precisely because Canada appeared to have no other dance partners. The imbalance allowed Trump to dictate tone and, at times, terms.
That backdrop is essential to understanding the current moment.
Canada’s re-engagement with China marked the first visible shift. Regardless of where one stands on the merits of that relationship, the signal was unmistakable. Canada was willing to explore economic relationships beyond its traditional orbit. That signal was then reinforced by Mark Carney’s planned engagements with India and Australia in March, two large, strategically important economies with deep ties across the Indo-Pacific.
The immediate question is whether any of these conversations result in concrete trade agreements. The more important question is what they signal. In any negotiation, the party perceived to have no alternatives is the easiest to pressure. The moment credible options appear, leverage begins to shift.
Trump’s renewed tariff threats look less like confidence and more like a bid to preserve leverage. In M&A, this is the moment when a buyer, worried about competing offers, pushes hard for exclusivity. The objective is not better terms, but to shut down alternatives. Canada’s outreach to other trade partners challenges the assumption that it has nowhere else to go, and tariff threats may be aimed at stopping that momentum before it reshapes the negotiation entirely.
Trump has always approached negotiations transactionally. He responds to positioning and leverage more than appeals to goodwill or shared values. From that perspective, Canada engaging seriously with China, India, and Australia does not weaken its relationship with the United States. It strengthens Canada’s hand within it.
This balance between signaling strength and managing friction was also evident in Carney’s recent speech at Davos. He won the room, earning a standing ovation and reinforcing his credibility with a global audience. At the same time, parts of the speech appeared to unnecessarily antagonize Trump. It is not obvious that poking the bear was required to make the point or to win over the crowd. The message may still have achieved its objective, but it raises a fair question about whether the same impact could have been delivered without adding friction to an already sensitive negotiation.
It is important to be clear about what this strategy does and does not imply. Canada is not abandoning its most important trading relationship, nor is it choosing sides in a broader geopolitical contest. The United States will remain Canada’s dominant economic partner for the foreseeable future. Diversification is not replacement. It is insurance.
In a sale process, a buyer often becomes most aggressive when exclusivity is no longer guaranteed. The risk of losing the deal sharpens focus. Tariff threats can serve a similar function in trade negotiations. They test resolve and probe whether the other side truly has alternatives.
Canada does not need to finalize every new trade discussion to benefit from them. The signal alone changes the dynamic.
As Carney heads to India and Australia following renewed engagement with China, Canada has now put those options clearly in view. That alone may prove to be its most effective leverage.
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