Supply Chain Now Episode 439
“To me, the most important thing that often gets lost to the public or lost in the narrative, I suppose, is the fact that in any successful negotiation, nobody gets exactly what they want, and that is okay.”
Nadia Theodore, Consul General of Canada in Atlanta
Media coverage of international trade details is typically reduced to oversimplified news headlines to the point that the actual meaning is lost to the average person. Ensuring that the intended outcomes are represented by and captured in the supporting legal documents is a highly complex and nuanced effort that must be actively managed by lead negotiators from all sides.
When those negotiators sit down at the deal-making table, they have multiple responsibilities to tend to in parallel. They have to represent the big picture objectives and intentions of their country, and they have to understand the relevant context behind any agreements that are currently in place.
As she prepares to leave the public sector for a role in private industry, the Consul General shares her perspective with Supply Chain Now Co-hosts Greg White and Scott Luton about:
· The fact that businesses need to operate in an environment that emphasizes stability and predictability – now more than ever – despite how difficult that is to achieve
· Why the biggest topic that no one is currently talking about is origin certification, and why it is more important than ‘sexier’ topics like labor, intellectual property, technology, and eCommerce
· How the recent tariffs placed on Canadian aluminum by the Trump Administration affect relations and business between the two nations
· Realistic ways companies can de-risk their extended, global supply chains
Intro – Amanda Luton (00:05):
It’s time for supply chain. Now broadcasting live from the supply chain capital of the country. Atlanta, Georgia heard around the world. Supply chain. Now spotlights the best in all things. Supply chain, the people, the technologies, the best practices and the critical issues of the day. And now here are your hosts.
Scott Luton (00:28):
Hey, good afternoon, Scott Luton and Greg white with you here on supply chain. Now, welcome to today’s show. On this episode, we had the distinguished honor of interviewing the consul general of Canada in Atlanta, Nadia, Theodore, Greg, great show lined up. Huh? Yeah, I’m pretty excited about this. So, you know, we’ve gotten to talk to the consul general of Mexico and we’re talking about that thing that nobody is, but everybody should be talking about U S MCA. So yeah, let’s do this. Absolutely talking to USC. I’m a U S MCA trade economy so much more. So stay tuned more to come on that and as special guests in just one moment, but Hey Greg, quick programming, before we get started for this special episode, big guest, if our listeners enjoy today’s conversation, they can find us wherever they get their podcasts from you are a family of supply chain programming continues to grow.
Scott Luton (01:24):
We’ve got something just about for everybody. A tequila sunrise supply chain is boring this week in business history. For any history geeks out there much, much more. You can find us wherever your podcast from and subscribe. So you don’t miss a single thing. Okay, Greg, are you ready? I’m ready. I mean, they can even listen to this in Canada, right? So as long as you have an Apple phone, you can listen to anything anywhere. Absolutely. The beauty of technology. All right. We speak English in 77 in 77 countries. That is correct. All right. So with no further ado, let’s bring in our featured guests here. Once again, the console general of Canada in Atlanta, Nadia, Theodore CG. How are you doing this afternoon?
Nadia Theodore CG (02:07):
How are you doing gentlemen? It’s a pleasure to be here. Pleasure to chat with you.
Scott Luton (02:11):
Yeah, likewise. Good to have you. We have really enjoyed our warmup conversation and certainly have enjoyed our, our prep conversations with Shantay on your team and really looking forward to sharing your insights and expertise with our audience. So, uh, before we, we jump into business, let’s get to know you a little bit better. Uh, Nadia. So tell us about yourself. Where’d you grow up and give us an anecdote or two about your upbringing?
Nadia Theodore CG (02:38):
Yes. Well, you know, I’ll have to say that. I’m glad that you gave me a heads up on this question because I’m really not that interesting. So I always have to think really hard about a fun anecdote. So I was born and raised in Ottawa, Ontario, Canada, which is the capital of Canada. And I was raised by two parents, a mother and a father. Both of them were federal public servants, uh, which I grew up to be as well. And I’ve got a brother and a sister, um, and really led a very kind of middle class, normal ish life. Um, which to me is a good thing, you know? Um, and I got interested really in all things trade and all things international trade in particular and global trade, uh, because both of my parents were immigrants to Canada. They were born in a small Island called st.
Nadia Theodore CG (03:40):
Lucia. And my dad is an economist and growing up, he used to, whenever we would go to the grocery store, he would always point out items in the grocery store and say, you know, Hey, do you know where this comes from, Nadia? Hey, do you know, you know, where this, where this originates from, where this fruit originates from, you know, what’s in this item that we’re buying this packaged item that we’re buying and where that comes from. He was kind of obsessed a little bit with, with food and agriculture and economics. And, and, and, and so I kind of begun to have a joy, uh, around everything that had to do with global commerce and, you know, fast forward for me, what really has helped me to maintain and sustain my love of, of global trade and in particular, making sure that everyday people understand what the benefits of trade are, um, and how we can make trade really impactful and meaningful for everyday people is when I had the opportunity to work in not a technical role back home, but more of a strategic role.
Nadia Theodore CG (04:59):
I was the chief of staff to the deputy minister of international trade, which is, um, the, the head of the department. So the head of our international trade department, the, the, the equivalent of USTA are here. And, you know, in that role, really seeing, getting away from the nitty gritty negotiations, which is what I was used to doing, and really kind of seeing how trade policy and some of the things that we’re going to talk about today translates into domestic policy and translates into the way that businesses actually operate and interact and move in the world globally really helped shape. What has now really just become a love for me of talking to everyday people about trade and about global commerce and about and about the, of it. So
Scott Luton (05:58):
Wonderful. Wonderful. I’ve got to go back. You painted such a wonderful picture, drew out some of your remarks here, but especially of you and your father in the grocery store, I love that exercise. Um, it sounds like maybe you didn’t know it, maybe he didn’t know, but it sounds like your father is a supply chain guy too, you know, and, you know, Greg, it also reminds me, um, one of the great silver linings about this age we’re in now, where consumers are starting to connect the dots globally about where stuff comes from and, and how it gets here. And it’s such a beautiful thing. And have you and your father have a leg up on that whole, um, learning process is wonderful. Um, and so, so your folks also st. Lucia, um, uh, any, any family still there, do you,
Nadia Theodore CG (06:48):
So, you know, we, we came from, you know, modest means. So I, I visited as a kid, maybe two, two or three times as a kid. Um, we got to go for a holiday and st. Lucia and I got to meet a few of my cousins, but you know, now my dad has long since retired. And so he has the luxury of spending Ottawa winters, um, in st. Lucia. And so, yeah, so I hope to join him one day.
Scott Luton (07:17):
Outstanding. What we’re gonna have to go ahead, Greg. I was going to mention that he, he does realize that he immigrated the wrong direction from South to North.
Nadia Theodore CG (07:28):
Scott Luton (07:30):
I’m sure he did it. I’m sure he did it for opportunity and probably for the family, but I bet it’s great to get back down there in the winter.
Nadia Theodore CG (07:38):
I bet it is. I, you know, he seems, he seems quite happy.
Scott Luton (07:43):
Oh yeah. I’m sure everyone is well. Okay. So you shared a couple of, um, or at least one role that chief of staff with the international trade department, um, here a moment ago, let’s talk a little bit more about your professional journey, um, and especially, uh, Nadia, if you could talk about any of the roles that you held that really impacted your worldview.
Nadia Theodore CG (08:09):
Absolutely. So, you know, going back to, um, to my background, which is in trade policy and in trade negotiations, I started in the federal public service, um, quite early on and, and worked for our revenue agency and then worked for our solicitor General’s office, and then went into what is now known as global affairs, Canada, which houses the equivalent of your U S tr um, uh, here, here in the States. And you know, much of my career was surrounded trade policy, negotiating trade agreements. Um, on behalf of Canada, I was the deputy chief negotiator for what is now known as the CPTP, um, which back then was the TPP, the transpacific partnership agreement,
Nadia Theodore CG (09:05):
And, you know, really was dead
Nadia Theodore CG (09:10):
Indicated to the details around trade agreements and negotiating the ins and outs of, of a trade agreement.
Nadia Theodore CG (09:18):
And, you know, then moved on, um,
Nadia Theodore CG (09:23):
A little bit abroad, even in my role as a trade negotiator. I represented Canada at the world trade organization and at the United nations, both in Geneva, Switzerland, and was responsible in fact, for technical barriers to trade and sanitary and phytosanitary measures, which many of your listeners might be familiar with really the nitty gritty of, of, of trade policy, uh, and international global business. Um,
Nadia Theodore CG (09:53):
And then, you know, coming back after
Nadia Theodore CG (09:57):
Being in Geneva, working on TPP, and then moving into the role of a chief of staff where you’re looking much more globally and much more strategically about trade policy and trade agreements and global commerce, and really trying to join up policy with business and how business actually operates. Um, and then going one step further for me in terms of bigger picture being appointed as our, um, had diplomat in the Southeast us, uh, in 2017 was kind of another layer of strategic horizontal view. And I have to say that
Nadia Theodore CG (10:50):
This role has really helped to shape my world view in the sense that I have a group
Nadia Theodore CG (10:57):
Greater appreciation for the importance of relationships, the importance of taking those technical details of a trade agreement, those technical policy pieces, and really translating that into an everyday business scenario, an everyday consumer scenario, and really being able to communicate with different levels of people in business and just in everyday life about what it means for them creating those relationships, um, has been what I’ve been doing for the past three years.
Nadia Theodore CG (11:35):
And it really has helped shape my view in the sense that now more,
Nadia Theodore CG (11:41):
More than ever, I appreciate, um, the importance of building those relationships beyond just legal text on a page or, or technical aspects of, of supply chains, end global commerce.
Scott Luton (11:54):
Wow, love that. Um, you know, we came across your interview with Debbie, a B E and NPR station earlier and loved that caught our attention right away. Um, you know, relationships, certainly they power the global economy and they certainly power the global supply chain, uh, world, and really appreciate your view there. So I’ve got to ask one question, uh, I love your passion for not just trade also negotiation. And, uh, I’m not sure if, you know, you’re, you’re talking with the world’s worst negotiator, uh, CG. That’s my cell. So what is, um, you know, when you think of trade policy and you think negotiate trade negotiations, and you think of, of, um, you know, those, those diplomatic teams that go hammer out these, these massive and really important agreements, what’s one thing that most, um, civilians or most folks maybe that never touched that world might not know that goes on and successful negotiations, any one thing come to mind?
Nadia Theodore CG (13:06):
Ooh. So to me, the most important thing that often gets lost to the public or lost in the narrative, I suppose, is the fact that in any successful negotiation, nobody gets exactly what they want. Um, and that is okay. Um, and in fact, nobody expects to get exactly what they want. Um, and I think that, that oftentimes get lot gets lost, right? Especially, you know, in today’s world of 24 hour or not even 24 hour news cycles and, you know, constant information being bombarded at us and kind of a gotchu attitude to, to news. Um, people seem to forget that, especially when we’re talking about trade, but across all difficult negotiations between countries in particular, that the complexity is beyond anything anybody could ever imagine. And so really, and truly, while you might be negotiating a trade agreement, for example, the U S MCA, you know, at the end of the day, the outcome that you were seeking vis-a-vis these two countries is much bigger and much more important than, again, the words on the page of a legal text of a legal document.
Nadia Theodore CG (14:31):
It often signifies a nod towards greater cooperation between two countries beyond trade and into security and economic prosperity. It often signals a understanding and a commitment to between those countries to be global leaders, um, in whatever area that they’re being that they’re negotiating. And, you know, in my case, it’s often trade, um, to be global leaders and trade to set the rules of trade globally together. Um, and so it’s much bigger than just the, the, the particular outcomes that you get on one issue area. Um, and so people often forget that, right? And, and sometimes focus on, on, on particular, um, nitty gritty outcomes, which are important, don’t get me wrong. And they have real business consequences for, for companies, which trick it trickles down to, to real consequences for consumers. Absolutely. But there is oftentimes most times 99.9% of times a much bigger picture that I think also needs to be taken into account.
Greg White (15:39):
I think that’s a really good, really good point is, you know, sometimes even in international trade, but certainly in, in international, uh, country negotiations, there’s so much that is unspoken or so much, that is, uh, that, that forms the backdrop of a negotiation, right. You screwed us back in 17, 17, and we want our, we want our little slice of that back or whatever. I mean, there is so many dynamics plus the country. I mean, you know, you have to represent the best interest of your country and, and you have to do that to the greatest extent you possibly can. And I think people, I think you’re right. I think people don’t always recognize that.
Nadia Theodore CG (16:31):
Absolutely. And, you know, and understanding that as a negotiator and remembering to ask the questions, you know, it might surprise you, but I was not around in 1879. And so, you know, I might not understand the context of something that happened 20 years ago or 25 years ago or whatever. Right. And so as a negotiator, even recognizing and understanding that there is context behind that and digging and asking questions, trying to get to the very root of why your partner might be suggesting something or not being able to agree to something, um, is very, very important and can help you get to the outcome that will work for, for all parties.
Greg White (17:23):
Yeah, I agree. And, and you know, another thing that somebody said about trade in general about supply chains as Scott was talking about is in the middle of a crisis, is not the time to try to make friends. You have to build those relationships over time, because it’s exceedingly difficult to do that. If you don’t have a good relationship, it’s exceedingly difficult to get good outcomes. As you said from somebody you don’t have a great relationship with. And it’s a little bit late to repair that. So people have to think about that as well. All right. So let’s talk about something that was negotiated probably before any of us were really old enough to pay much attention to it. And that’s the transition from NAFTA, the former North American free trade agreement to us MCA. And, and give us a little bit of background and maybe tell us a little bit about how, how you saw that come about and, and what you see as the significance of it.
Nadia Theodore CG (18:23):
Yeah, absolutely. So, you know, I am very proud of the, let me, let me start by saying, I am very proud of the, the modernization of the North American free trade agreement that is now the U S MCA. Um, because I really do, you know, I am a self proclaimed tree, so, you know, um, there, there was that, so I would be thrilled with it. Okay. Um, but I really think that, especially in a time of COVID-19 in a time of rising protectionism around the world, um, and in a time where companies and businesses now more than ever really need to operate in an environment that is personified by stability and predictability, um, because of all of the externalities that are exactly the opposite for them. Um, I think that the U S MCA really is about facilitating trade for businesses. Um, it really is about creating predictable, transparent rules. We were able to maintain that predictability and that transparency. Um, and I think that, you know, there are in particular, a couple of areas that really do, um, represent significant changes from what we knew, what we had in Nazca to what we have now in order for businesses to really thrive, um, and, and expand abroad. Um, and I, and I’m happy to go into a couple of them if, if, um, if you’d like me to,
Greg White (20:12):
Well, yeah, yeah. I mean, I think that really goes into the next question. I think the first thing that you said was modernization of NAFTA, because that is the core essence of what this does. And it also reduces friction, even though there wasn’t a tremendous amount of friction between us, Mexico and Canada. Um, but it reduces the friction for border crossings and things like that. But yeah, please tell us what you think business people or supply chain professionals generally ought to know about what USM brings us and what it brings us to a better is it from, from NAFTA, for sure.
Nadia Theodore CG (20:53):
Yeah. And, you know, I liked the way that you put that it reduces friction. Um, absolutely. And I think as well, you know, I, I want to underscore that the quantifier that you just use, you know, what do business leaders and supply chain professionals need to know? Um, and I think that that’s important because, you know, especially somebody like me, I can get a little bit wonky, um, when I started talking about training policy, but, but, you know, there are things in the agreement that are actually very, um, useful and important for actual supply chain leaders and business leaders to know about. And so the first thing that I would say, um, is around this whole idea of procedures for origins certification. Um, and I’d like to talk about origin certification because we hardly ever talk about it. Um, it’s not as sexy as, you know, labor and intellectual property and technology and eCommerce, you know, all of those things are great, but you know, origin certification, which as your supply chain leaders listening will know is the procedure that needs to be used to certify that this thing that they’re importing the good that they’re importing qualifies for the 0% tariff treatment that they’re going to take advantage of.
Nadia Theodore CG (22:16):
Right. So, you know, it is actually very important for everyday business and under the U S MCA, again, going to your idea of reducing friction, we incorporated much more flexibility around the form that this certification can take while, you know, of course maintaining all of the requirements around substance. So, so now assert a certificate of origin, um, can be provided on any type of documents or you can use an invoice or any other documents that comes from any one of the three NAFTA parties, USMS parties. Sorry. Um, so there’s no kind of special form anymore. Like it was under the NAFTA, as long as it contains it, it looks long as it contains the information information, right. And also the other two most important things for me. And, and, um, and most interesting things is that now it’s not just the Xsporter that can complete a certificate of origin.
Nadia Theodore CG (23:18):
The importer can also complete the certificate of origin. So again, reducing that with that, that, that friction making it easier for, for business leaders, business people, and especially small businesses, right. To navigate that system. And then, and then the third thing, and the last thing that I’ll mention on this one is this, the fact that, um, a certificate of origin can actually now be completed and electronically. So we have finally entered the 21st century, you know, no longer, yeah, exactly. Here we are. But you know, you no longer have to have the special form that you got to download from the special website and print out and have it all find and then find a stamp, you know? I mean, yeah, exactly. So, and especially for small businesses, right. Especially for people who, you know, I’d like to say you can’t afford all the fancy lawyers, um, this is, this is important, significant, um, and, and will significantly reduce that, um, that regulatory, um, barrier to getting preferential treatment.
Nadia Theodore CG (24:33):
Yeah. And then of course, you know, I would be remiss if I didn’t talk about, um, the, the automotive rules of origin. Cause everybody’s talking about that, right. The changes, uh, under, under the U S MCA. Um, and you know, just to talk about that a little bit, it is, it is a little bit complicated, but to give your listeners a little bit of an overview. So the overall regional value content for, for cars, vehicle, passenger vehicles and light trucks under NAFTA, it was 62.5%. We’ve increased it under the U S MCA to 75% with the phase in period. Nice. And that companies will need some time to, to get themselves, um, uh, up to speed. Right. Um, and we created three new new categories for auto parts. So now you have core parts, principle, parts, complimentary parts, all of which have a different RVC, a again with phase and periods.
Nadia Theodore CG (25:34):
Um, and then of course, would everybody talking about with regards to the auto rules of origin, is this labor value content, which is brand new, never been done before in a trade agreement. And, you know, with that labor value content, everybody is talking about one of the sub sectors that was negotiated and that’s around, um, the, the, the $16 wage, um, requirement. So one of the subsections under this labor value content is for high wage material and manufacturing. Um, and that is calculated by taking basically your entire purchase value over a year of all of the parts and materials that were produced by workers that make at least $16 per hour. And so that’s where you, you know, many of your listeners will have heard of this labor requirement under the U S MCA for, for workers to be paid $16 an hour. Um, and it’s a little bit more complicated than that. It is really one subsection of a labor value content under the auto of origin, um, that everybody, everybody is talking about. And then also, and, you know, and I have to say, now, anytime I say the word aluminum, I get a little bit annoyed, but we also negotiated under the auto rules of origin are requirements that OEMs, um, have to source 70% of their aluminum and steel from, from North America. And I say, aluminum with I’m scowling, you can’t see me, but,
Greg White (27:11):
Well that’s okay. At least you say it properly. I’m not Al Al you, many of them are British. I know, I know it does sound nifty when they say it that way. Every time they say it, I’m not kidding every time they say it, Nadia, I go and double check just to make sure there is no I in there. Um, cause every time it gets said, it’s been a while since I’ve seen the word, it seems like, well, let’s, so let’s look, we talked about how we have, uh, sort of expedited and reduced friction and that sort of thing, and updated this, as you said, to consider digital and an eCommerce considerations and, and, uh, you know, sometimes, uh, consumer shipments as well as business to business shipments across borders. I think, look, I can tell you that Scott and I are big fans of this agreement, um, because it, it does right.
Greg White (28:15):
What was lacking in NAFTA. Um, and it brings it, as you said into the 21st century brings the agreement into the 21st century. And I think what people need to recognize is how fortunate we are to have a continental agreement among just three countries. I mean, this is exceedingly more difficult to accomplish in other continent, South America, Europe, Africa, and Asia, because there are so many countries. And as you alluded to even earlier, so many of those diverse interests that make, would make something like this exceedingly difficult. And particularly in these times where we’re talking about near shoring or reassuring or China plus one or whatever, it’s good to know that you have people on, on your shores that are friendly enough friendly. Cause we’re going to get to that whole aluminum thing, right. Friendly enough that, you know, at least they don’t have adverse adverse interests to your nation’s principles. Um, and I think, I think people need to recognize and embrace that. And frankly, I think that’s probably one of the best things about this is that people recognize that the simplicity, frankly, that we have in being able to create a continental agreement like this.
Nadia Theodore CG (29:35):
Absolutely. And you know, you said it quite rightly perfectly that the, the simplicity
Nadia Theodore CG (29:42):
And the benefit that we have in North America to have neighbors that we can trust to have not just their own interests in mind and at hurt, but the collective interest in mind and at heart is something that, you know, we have taken advantage of. Right. Um, but it, it, it shouldn’t be now more than ever. Um, we really need to understand how lucky we are and not sit on our laurels, um, and, and, and, and work to maintain that, that strong, positive relationship, um,
Greg White (30:27):
Keeping that relationship in the face of, of this irritant to you. So tell, tell us, so clue are our listeners in, in case they don’t know what’s going on with this aluminum situation. What’s your take there?
Nadia Theodore CG (30:43):
Yeah. So listen, we won’t spend too much time on it because this is a happy conversation, but I have to say that as of Sunday, uh, the United States has, um, put in place a 10% tariff on Canadian aluminum that came into effect on Sunday. Um, that of course, you know, no surprise to you. Uh, my, uh, my I and my country believe, uh, to be completely unnecessary and an unwarranted, um, you know, the rationale going back to what we were just talking about, the rationale is twofold, um, that there has an all address both of them quickly, that there has been a surge in aluminum exports from Canada into the United States and that this poses a national security threat to the United States. So let me take the first one, um, this idea of a search. So, you know, the fact of the matter is, is that trade in aluminum between Canada and the United States has really, um, been consistent with historic levels.
Nadia Theodore CG (32:07):
What is true is that because of the global downturn that we have seen over the last few months, um, there has been obviously a decline in manufacturing, which has resulted in more of a demand for a certain type of aluminum, non alloyed aluminum. Um, and those exports have gone up while other types of aluminum exports have gone down, which, you know, results in an overall trend that is consistent with historical trade in, in aluminum, and even more so that non alloyed aluminum that we saw a surge in over the past several months is actually now already begun to decline significantly as things get back up and moving in the economy. Right. And, and especially in terms of, in terms of manufacturing. So that addresses the first point, you know, and then to add insult to injury, in my opinion, um, you know, the idea that Canada is a national security threat to the United States is just a bit, you know, I mean,
Greg White (33:27):
We know that you have troops perched on the border Nadia.
Nadia Theodore CG (33:31):
We do, and we have, we have troops perched in each other’s, you know, um, in each other’s armies, you know, like we are, you know, so anyway, it is, it’s, it’s a bit ridiculous, but also a little bit sad and insulting. I have to say for me in particular, um, and you know, I would also tell people, and I say this, um, very seriously, because I think it’s important that people, you know, I am Canadian, I represent Canada. So many of your listeners, you know, might say, well, of course, she’s not gonna come on here and say, you know, absolutely Canada’s a problem. You know, I, you know, of course that’s not what they pay me for. Um, but you don’t have to listen to just me. Cause because in fact, the us chamber of commerce, the American aluminum association, you know, in fact, every American aluminum stakeholder, except for two loan companies, um, which I won’t talk about, but you can do your own research as to where those companies come from and where their interests are.
Nadia Theodore CG (34:38):
Um, all aluminum companies and together with the chamber, the us chamber and the American aluminum association have come out against the tariffs being imposed. And, you know, for me, we should be right now celebrating U S MCA. We should be, um, maintaining what we talked about before this transparency and predictability and dependability for our companies. We should not be Canada and the United States in a, in a trade, uh, dispute. Um, and that’s, what’s going, that’s what’s happening, right? Because I mean, Canada obviously needs to now put in place dollar for dollar countermeasures, which we are going to do on, on September 16th. Um, if, if the tariffs are not removed by then, um, which is unfortunate because what we really should be doing is helping our businesses recover, uh, celebrating the U S MCA
Nadia Theodore CG (35:38):
And maintaining the stability and predictability that, that this modernization of the, of the agreement has provided us to date.
Greg White (35:46):
I think we have to acknowledge some of those underlying conditions that we were, we were talking about earlier, Nadia, that one, the big underlying condition is it’s an election year and two, the biggest States for aluminum production are swing States. And in, you know, in key States and in this election. So for people who aren’t from the U S the whole country doesn’t vote for the president, um, the whole country or each state votes, and then is assigned whoever won that state. So it kind of comes down to that, but you’re right. It is, it is to say the least counterproductive. And particularly in the first year of this agreement. And also, I think the best point you made is one. We should be talking about U S MCA, which we are hardly doing. And I think that’s because it’s over shattered, but overshadowed by the seismic societal disruption it’s caused by COVID. But, um, we should be talking about it more and we should be celebrating all of that frictionless ness, if that’s a word and all of the things that we’re trying to accomplish with it. And, um, I Nadia in my naive fashion have faith. I can’t believe I’m going to say this have faith that we will get past this post election. And, um, in that way, I’m recognizing also gang that I did just say that I have faith in politicians, which is laughable.
Nadia Theodore CG (37:24):
I’ll have faith as well. I have faith as well as I have nothing to say about politicians or elections, because I have a visitor in your country.
Greg White (37:32):
Well, so we are, we are joined in our naivete, ms. Nadia. So I think that, I think that’s what most of us can hope for. Um, all right, well, uh, I’m glad you hit that. And by the way, for a diplomat, you did that, uh, diplomatically boldly. So I really appreciate that you could have really minced words there, but I really appreciate that you confronted that head on. We’ve got a new phrase now, Greg diplomatically boldness, uh, yeah.
Nadia Theodore CG (38:04):
Automatically bold. I love it. I love it. That’s going to be my signature.
Greg White (38:10):
There you go. All right. So let’s, let’s rush to another topic and, uh, and let’s talk about, um, let’s, let’s do a little bit of, as CRA, as Scott loves to say, let’s break out your crystal ball, or let’s just talk about what you see, um, what has mind share for you into the future or, or right. Um,
Scott Luton (38:36):
You know, what is, what are you spending cycles thinking, being concerned, joyful, challenged by,
Nadia Theodore CG (38:45):
Yeah, that’s a good question. So, you know, maybe I’ll take it. I can spend a lot of time talking about what I’m joyful about, but much of it doesn’t have to do with anything to do with supply chains, frankly, because, you know, two of the things that I spend a lot of time thinking, reading, listening to radio shows and podcasts about is, you know, the, the kind of shift that we are seeing or not seeing with regards to global supply chains and the decisions that companies are taking, um, in the face of two things in the face of rising protectionism, um, and in the face of what I kind of think of in my head as changes in the way that we define risk or, or how we prioritize de-risking and factors leading to de-risking our businesses, um, in the face of COVID-19. Um, and, you know, I’m thinking about that more often now, because, you know, we have really spent the last 25 years or so creating these global frictionless synchronize supply chains that are really geared towards delivering lower cost.
Nadia Theodore CG (40:23):
Good. Um, and we have really excelled in that model right. Of, of cutting costs and, and, and moving towards this frictionless and synchronized supply chains. Um, and, and if we think about now, given COVID, um, in particular, there’s this whole conversation going on about whether, um, companies are going to move towards reassuring supply chains, moving closer to home, um, whether we’re going to see a mass Exodus of companies, American and Canadian companies that are located in China, um, moving back to North America, you know, what I’m spending a lot of time thinking about that and, and, and, and thinking, and listening and reading about what others are saying about it. And, you know, what I find really interesting is, well, first, what I think we need to realize is that, and I’m preaching to the choir here. I’m stating the obvious supply chains are complicated. They’re not homogeneous. Um, they differ amongst and between sectors and even within the sectors. And so, you know, it’s hard to talk about supply chains and
Nadia Theodore CG (41:42):
One kind of world view as to where supply chains are going, because it’s very complex and very differentiated depending on what sector you’re in.
Nadia Theodore CG (41:50):
But I think that what the data is showing, interestingly, at least now,
Nadia Theodore CG (41:56):
And in fact it was the us chamber of commerce, I believe, but don’t quote me, who did a study, a survey of, of companies asking them whether they were going to be leaving, um, China in the near future and reassuring back home.
Nadia Theodore CG (42:13):
And many of them answered no, because many of them
Nadia Theodore CG (42:18):
Nadia Theodore CG (42:20):
Because not because they, um,
Nadia Theodore CG (42:24):
Assemble in China and then shipped back home to North America,
Nadia Theodore CG (42:28):
But because they serve that region via, um,
Nadia Theodore CG (42:34):
Via China. Right. And so while many of them said that they are, they might be thinking of moving to Vietnam or Indonesia.
Nadia Theodore CG (42:41):
Um, not many of them said that they were moving
Nadia Theodore CG (42:44):
Back to North America. And I think that that’s quite interesting.
Nadia Theodore CG (42:50):
Um, but again, you know what I do find to be
Nadia Theodore CG (42:56):
What I’m thinking about, especially in the context of, of, of Canada and North America and how we kind of attract investment long term into our countries is I do think
Nadia Theodore CG (43:09):
That when you talk about price,
Nadia Theodore CG (43:11):
Seeing risks, um, into supply chains, I think that companies are going to approach that very differently.
Nadia Theodore CG (43:19):
And I think that creating redundant
Nadia Theodore CG (43:21):
And, and sees incensing will become more popular as a way to de risk your business. Um, so which could mean not necessarily moving everything from China to the United States, but finding different sources for some of your, your, those supply chains, um, diversifying some of those supply chains, having different hubs, one in, in Asia and one in North America. Um, I think that that is something that we might see more of in the future.
Nadia Theodore CG (43:53):
Um, and then, and then secondly, you know, this whole idea of
Nadia Theodore CG (43:59):
Idea, reality, frankly, of rising protectionism and the resulting volatility volativity, um, um, that this causes companies is something that I’m also kind of thinking about because you know what I have learnt, what we all have learned to be true is that companies really thrive on certainty. They need to know that they can source the materials that they need for their value chains, that they can access top talent. Um, whether that talent is already in location, where are, or whether they need to, to, to bring them in, um, and that they all have preferential access to a wide variety and diversity of markets. Um, and what we’re seeing now is that those three factors sourcing the materials that they need access to top talent and preferential access to markets. You know, not all countries can provide that, um, optionality and predictability and stability. Um, and you know, what I, uh, selfishly, um, know is that Canada we can, right. Um, and so, you know, we have trade agreements with 51 countries. We have very predictable and business friendly immigration policies. We have all of these incentives for capital cost allowances. Um, and so I’m kind of thinking about how Canada positions itself within a broader North American context to really attract and maintain investment, recognizing that those top three things, um, sourcing materials, talent, and preferential access to international markets is really what’s going to be on the minds of businesses, um, in the future,
Greg White (45:47):
You have a lot on your mind, but I think, I think the thing that really stands out to me is that one of the first statements you made about supply chains being predominantly, at least of late in focused on cost reduction. And the truth is, and this is my personal philosophy. I think some people share it with me. I think Scott does and others, but supply chain is foundationally about risk management and risk includes paying too much for the product, but risk also includes paying very little for the product, but having no plan B. And, and I have seen companies who, who have mitigated that problem for decades, and frankly, Nadia, I’m a bit surprised that some of the largest companies in the world did not have a plan B right. Did not have a, you know, now we’re talking about China plus one or China plus two, but it seems like it would have been prudent to always have that.
Greg White (46:50):
And I know many, many companies who did, and they were still rocked by this, you know, this pandemic, but at least they weren’t 100% or 99% in, in a particular domicile and completely hamstrung. So I completely agree with that. And then when you consider things, like, I mean, as long as we’re talking about protection as policies, right? I mean, you think, you think we got it bad with aluminum between us and Canada. Um, you know, think about what we’ve got with China and China with so many other, um, right. And, and they are so far away, right. At least we can go knock on your door and say, please, I knew, likewise,
Nadia Theodore CG (47:40):
You know, I can, you can bring me an Apple pie. I can bring you in the Nymo bar and we can work it out.
Greg White (47:50):
Yeah, exactly. But no, but all of those things, all of those things are really important. And I think, you know, to me, I don’t know that the, the difficulty that we’ve got is we can’t with the accumulation of production capacity in the rest of the world, duplicate the production capacity in China, as you said, in some cases, it’s not prudent to move out of China if you were servicing China. Um, and, and the other aspect of that is whether, whether we have, whether we can do it cost effectively or how we do it cost effectively, if we can somehow duplicate production capacity maybe with robotics or automation or, or, you know, or user assist or whatever. So there are all of those complexities, which you to bring us back full circle, which you talked about at the very beginning, right? There are a lot of complexities in international discussions and trade negotiations. And of course there are a lot of those similar complexities in a supply chain. So your mind is perfectly set for the transition between diplomacy and supply chain. Because if, if they’re not, if they’re not completely aligned, they are very, very closely aligned. So,
Nadia Theodore CG (49:09):
So from your lips to God’s ears,
Greg White (49:12):
Because we’re about to find out why that statement matters. That is right. Perfect segue as always Greg. So, you know, uh, the diplomatic industry, if that is the right way to put it, um, it’s loss is going to be the food industry’s gain. And we’re going to find out more about that, uh, CG, tell us about your exciting new news and the transition that you’re about to embark on.
Nadia Theodore CG (49:35):
Yeah. So I, in the next few weeks we’ll be leaving Atlanta, um, and leaving the diplomatic Corps and leaving the federal public service and going to work for the private sector. I will be going to work indeed for maple leaf foods, which is, uh, many, many of your listeners might know it, it is an iconic Canadian company. Um, and, uh, yeah, I will be, uh, working as their senior vice president for global government and industry affairs. So I will be into the world of, of, of food and supply chains indeed. And, and, and, and a chronic Canadian brand, which for me, most importantly, is, is going to be something quite special and trading
Nadia Theodore CG (50:28):
In one maple leaf for Netherlands, my friends aren’t.
Scott Luton (50:32):
Yeah, very well said. I love that. Well, you know, um, I think a lot of folks, a lot of our listeners might, would recognize maple maple leaf foods, you know, Swift, uh, the Swift brand Schneider’s prom, Greenfield, natural meat company. These are, these are brands. A lot of folks, uh, are familiar with. And man, what a great get for the organization to have a leader, join them with your depth of experience, um, especially, uh, your expertise in international trade and negotiation. I feel sorry. I feel sorry for some of the folks that they’ll be negotiating with given your skill there. Uh, but what a great, how did it, you may not can address all of it, but, um, how did the opportunity come about, uh, clearly it seems, it seems like your father and those grocery store visits, um, may have, uh, you know, planted a seed, no pun intended. Uh, how did, how did this appeal to you and why did this appeal to you?
Nadia Theodore CG (51:37):
Yeah. You know, that’s a good question. You know, like I said, this role being here in Atlanta, um, the role is being, you know, a top diplomat for my country really provided me with a, kind of an overview of what I found to be most enjoyable in terms of work. Um, and it really came down to three things for me, what was important to me was the ability to really, um, build and maintain and sustain relationships and be part of an organization that understands the importance of that and be able to contribute to that. Because I think that that is, you know, a little bit of my superpower. Um, and then too, I have really enjoyed, again, the synergy between the policy and actual companies, actual businesses, um, and, and, and, and having the opportunity to not just work inside any old business, any old company, but, you know, uh, uh, Canadian, um, brand name, iconic company, um, was something that I really, um, was really, um, special for me. Right. And then, and then thirdly, you know, I am somebody who really believes in the possibility of good in business. Um, I really do believe that corporations and businesses can contribute to a equitable
Nadia Theodore CG (53:26):
And sustainable, um, planet and world. Um, so, you know, maple Leafs tagline to be the most sustainable protein company on earth and to raise the good in food, um, really appealed to me. Uh, it appealed to me that, you know, we all kind of this idea of private public partnerships. It’s not all about the public sector and it’s not all about the private sector. We need to kind of work together to, to ensure that every day people see the benefits of all of these trade agreements that we’re negotiating, right? All of these supply chains, these global supply chains that we’re working so hard to maintain, um, to, to, to, to grow our economy everyday, people need to see the benefits of that. And, and they believe foods is a company that also believes in that. So, so I’m, I’m excited, I’m excited,
Scott Luton (54:18):
Outstanding, outstanding. Well, uh, we’re excited for you and we look forward to having you back on, um, and, and bringing your insights on, uh, what you experienced in the food industry, especially as a U w how’d you put it, you raise the good and food, raise the good in food, love the hats. Okay. Um, all right. So let’s make sure that folks know how to connect with you, and certainly how to connect with the Canadian consulate in Atlanta. Um, I bet you got a, um, an ongoing request, uh, calendar for interviews and whatnot, given what you share with us here today, how can folks connect with you and, and the team
Nadia Theodore CG (55:00):
After busy? So you can follow us on Twitter. That would be wonderful. We are, um, the, the office is the symbol and then C a N C G Atlanta. So follow us on Twitter. Um, and then you can, you know, if you want to follow me personally, I don’t tweet all the time about work stuff, actually, almost never, but, you know, you can follow me as well. You can follow me as well if you’d like, I’m Nadia underscore Theodore, but, but for everything work-related, you can follow the consulate and then you can, you can always, um, email us, you know, you can, if you just go into the Google search and type in Canadian consulate in Atlanta, our email will pop right up. Um, we are, we are kind of an open book and you can drop us a line we’d love to hear from people. Um, and, and, and we’d love to engage with all of your followers further on, on social media and otherwise,
Scott Luton (55:57):
Well, I love on your Twitter profile, you’ve got recovering trade policy wonk. I love it. I’ll tell ya. Um, maple leaf foods, is it, I mean, what just a great, uh, great win for them. Great. Coup and we look forward to, to bring you back on and kind of seeing how this, this next chapter in your, um, really interesting journey goes. So thank you so much console general of Canada in Atlanta, Nadia, Theodore.
Nadia Theodore CG (56:26):
Thank you so much, Scott. Thank you so much, Greg.
Scott Luton (56:30):
Thank you. Now, now you can give those lessons back to your father. You can see
Nadia Theodore CG (56:36):
No, no, where this come from now. I can’t wait full circle.
Scott Luton (56:44):
Wonderful. What a great, great thought Greg. Well, Greg, what a fascinating conversation, you know, there, there were, there were so many different angles of, of not just a U S MCA, but of that world. That’s so important being the diplomatic Corps as, as the CG put it. Yeah, I think, look, I, I actually am really encouraged by, and I hope we, um, continue to have the kind of openness that Nadia shared here. Um, you know, the three we’ve got to think of, of, and I think she said this, we’ve got to think of us and Canada and Mexico as a family, right? And sometimes you get pissed at your family members and you fight and, um, but ultimately, you know, you have to live together, right. And hopefully you care enough for one another to make that, make that, um, good for, for everyone in the family.
Scott Luton (57:40):
So I think that that spirit it’s okay to argue, right. But in the end where we’re all together. Um, and particularly because we are doing things in the greater scheme of things that are making our trade relations, our, our diplomatic relations even better. And I, I would have, I would argue that they’re very, very good by any standard. I mean, I’ve spent a lot of time in Europe and I know Nadia has to a lot of time in South America. And that is the kind of relationship that we have with our neighbors on our continent is exceptional compared to that. Yeah, we’ll put, uh, you know, regardless of what comes our way, we’re much, much better together. And if we can continue to make trade successful, there are so many wonderful spillover effects that will strengthen the relationship and the, the, the, the family, as, as you put it in, as Nadia put it between Mexico, Canada and the United States.
Scott Luton (58:43):
So we’ll, we will keep our finger on the tabs as U S MCA continues to take root and provide a lot of great things for all three countries, business community, and really for that matter, the international economy, um, own that note, Greg, uh, hopefully our listeners, hopefully listeners enjoy this conversation as much as we both did. I know I was on mute a lot, but I was laughing. Naughty has got a wonderful sense of humor, but a lot of business lessons learned that are, that are APPL applicable beyond the diplomatic Corps. No doubt. We look forward to watching this next phase. So Hey to our, uh, check us out. If you enjoy today’s episode, you can check out a wide variety of other interviews at supply chain. Now, radio.com, fondness and subscribe wherever you get your podcasts from on behalf of our entire team here, Greg white and Scott Luton, and the whole team here at supply chain. Now, Hey, do good. Give forward, be the change that’s needed. And on that note, we’ll see you next time.
Nadia Theodore was appointed as Consul General of Canada in Atlanta in September 2017, with accreditation for Alabama, Georgia, Mississippi, North Carolina, South Carolina and Tennessee. As Consul General, Ms. Theodore is the Government of Canada’s senior diplomat in the Southeast USA. Prior to her appointment as Consul General, Ms. Theodore served as Chief of Staff and Executive Director to Canada’s Deputy Minister of International Trade. Ms. Theodore has also served at Canada’s Permanent Mission to the World Trade Organization and at Canada’s Permanent Mission to the United Nations (both in Geneva, Switzerland). With over 20 years experience in the Canadian federal public service, Consul General Theodore has built a reputation for forging strong partnerships with government and business leaders and building strong multi-disciplinary teams. Ms. Theodore has made advancing inclusion in the workplace a core pillar of her mandate as a senior executive in the Canadian public service and as Consul General in Atlanta. She is committed to making sure that the public service is included in the global conversation on diversity and inclusion within organizations and the deliberate work to build inclusive teams, including and especially at senior levels.
Greg White serves as Principal & Host at Supply Chain Now. Greg is a founder, CEO, board director and advisor in B2B technology with multiple successful exits. He recently joined Trefoil Advisory as a Partner to further their vision of stronger companies by delivering practical solutions to the highest-stakes challenges. Prior to Trefoil, Greg served as CEO at Curo, a field service management solution most notably used by Amazon to direct their fulfillment center deployment workforce. Greg is most known for founding Blue Ridge Solutions and served as President & CEO for the Gartner Magic Quadrant Leader of cloud-native supply chain applications that balance inventory with customer demand. Greg has also held leadership roles with Servigistics, and E3 Corporation, where he pioneered their cloud supply chain offering in 1998. In addition to his work at Supply Chain Now and Trefoil, rapidly-growing companies leverage Greg as an independent board director and advisor for his experience building disruptive B2B technology and supply chain companies widely recognized as industry leaders. He’s an insightful visionary who helps companies rapidly align vision, team, market, messaging, product, and intellectual property to accelerate value creation. Greg guides founders, investors and leadership teams to create breakthroughs that gain market exposure and momentum, and increase company esteem and valuation. Learn more about Trefoil Advisory: www.trefoiladvisory.com
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