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Yahoo
12 hours ago
- Business
- Yahoo
Promising policy action brings hope amidst continued economic challenges: PwC's 2025 M&A mid-year update released
Transformative policy actions could boost Canada's role in North American supply chains and stabilize ties with the US. Trend shows decline in inbound and locally sourced deals; overall deals activity comes in at approximately 1000 deals totalling $134B announced since January 2025. Canadian family offices rebound: deal values increased by 16% from 2023 to 2024, signaling renewed momentum. TORONTO, June 18, 2025 /CNW/ - PwC Canada's 2025 mid-year Canadian M&A update highlights a pivotal moment for the Canadian economy. Amidst global uncertainty and a cooling domestic outlook, Canada is pursuing a bold policy agenda aimed at restoring national economic resilience. While these efforts are rooted in domestic priorities, they may also yield a valuable secondary benefit: a more stable and strategically aligned relationship with the United States. "Canada's current policy direction focuses on building a stronger, more self-reliant economy," said Michael Dobner, National Leader of Economics and Policy Practice, PwC Canada. "This approach also helps foster a more constructive and complementary relationship with the US, one based on shared interests rather than dependency." Economic update: Between January and May 2025, Canadian companies announced 996 deals totaling $134 billion. However, the report notes declines in inbound and locally sourced deals in Canada. This reflects a broader climate of caution, as businesses delay investments and expansion plans in response to persistent uncertainty. PwC's baseline projection for Canadian GDP growth in 2025 remains below 1%. Despite these headwinds, Canada's trade position with the United States remains comparatively strong. Canadian exporters are generally benefiting from relatively low tariffs, especially when compared to countries like China, which continue to face significant trade barriers to the United States. This advantage can help some Canadian businesses to maintain or even grow their market share in the US, offering a rare bright spot in an otherwise subdued economic landscape. In this context, "the current negotiations between Canada and the United States, which benefit from Canada's new vision, may further strengthen Canada's relative trade position with the United States," added Dobner. The report outlines a suite of policy priorities shaping Canada's new vision. Key priorities now include streamlining regulations, initiating large-scale infrastructure projects, increasing investment in defence and Arctic development, removing interprovincial trade barriers, fast-tracking the integration of artificial intelligence and changing the immigration system to focus on attracting highly skilled individuals to Canada. These initiatives are designed to address Canada's productivity and competitiveness challenges, and, if successful, will also position the country to play a more active role in North American supply chains and innovation ecosystems. If early policy actions are interpreted by market players as genuine, practical and decisive, PwC Canada suggests that meaningful improvements in Canada's economic outlook could begin as early as 2026. All levels of government have a crucial role in providing these signals over the coming months. While there is good reason for cautious optimism, the report notes that the global environment remains unpredictable. Potential global crises, financial crisis as a result of a loss of trust in the US dollar, or disruption of entire sectors by emerging technology could have significant consequences. Canadian businesses must stay vigilant, closely monitor global developments and adopt flexible, risk-aware strategies to navigate an uncertain future. Opportunities for Canadian family offices: The report also highlights the evolving role of Canadian family offices, which are emerging as increasingly influential players in the investment landscape. After a period of decline beginning in 2021, family office deal activity is rebounding. In Canada, deal values rose by more than 16% from 2023 to 2024. Key trends shaping this evolution: Club deals, where family offices co-invest with peers to access larger opportunities and share risk, are gaining traction globally. While only 23% of Canadian family office investments in 2024 were structured this way, compared to 71% globally in 2022, this gap signals untapped potential. Impact investing is on the rise. In 2024, Canadian family offices surpassed the 50% threshold for allocating capital to investments that generate measurable social or environmental impact alongside financial returns. These investments are increasingly aligned with national priorities such as productivity, innovation, and affordable housing. Direct investments, where family offices invest directly in businesses such as private equity, startups or M&A, have grown to represent 70% of global activity, up from a real estate-heavy focus a decade ago. In contrast, 69% of Canadian family office investments in 2024 remained in real estate, indicating potential opportunities to diversify investment portfolios. For more insights and to access the full report, visit About PwC Canada: At PwC Canada, we help clients build trust and reinvent so they can turn complexity into competitive advantage. We're a tech-forward, people-empowered network with more than 7,000 partners and staff in offices across the country. Across audit and assurance, tax and legal, deals and consulting, we help build, accelerate and sustain momentum. PwC refers to the Canadian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see for further details. Find out more by visiting us at: © 2025 PricewaterhouseCoopers LLP, an Ontario limited liability partnership. All rights reserved. SOURCE PwC Management Services LP View original content to download multimedia:
South China Morning Post
06-06-2025
- Business
- South China Morning Post
With US-China rivalry ‘putting the squeeze' on Asian markets, is taking sides an option?
Caught in the undertow of swirling power plays between China and the United States, Asia has become like a piece of driftwood battered by the pounding of opposing tides. With key tariff deadlines approaching in July, and in light of lingering trade tensions between the world's two biggest economies, many countries in the region are facing a delicate, pragmatic choice: bow to Washington's growing pressure to crack down on supply chains and enforcement – or preserve the economic ambiguity that underpins their deep ties with Beijing? Asian countries have entwined their supply chains, technology, markets and investment with Beijing – accounting for one-third of China's total trade volume, or US$1.89 trillion last year. Meanwhile, some of them may need security assurances from the US amid the growing Chinese influence in the region, analysts said. China remains the top trading partner for 18 countries across the region and has been the largest trading partner of the Association of Southeast Asian Nations (Asean) for 15 consecutive years. Meanwhile, economic asymmetry and military advantage have often translated into Beijing's leverage in market power while, for many in the region, Washington represents security, diversification and strategic rebalancing, with its military presence, investment and advanced technology, analysts said. That leaves many Asian economies walking a tightrope – benefiting from China's vast market while remaining wary of the risks of over-dependence. For much of Asia, maintaining ties with both while caught in between has become a survival strategy.
South China Morning Post
06-06-2025
- Business
- South China Morning Post
With US-China rivalry ‘putting the squeeze on' Asian markets, is taking sides an option?
Caught in the undertow of swirling power plays between China and the United States, Asia has become like a piece of driftwood battered by the pounding of opposing tides. With key tariff deadlines approaching in July, and in light of lingering trade tensions between the world's two biggest economies, many countries in the region are facing a delicate, pragmatic choice: bow to Washington's growing pressure to crack down on supply chains and enforcement – or preserve the economic ambiguity that underpins their deep ties with Beijing? Asian countries have entwined their supply chains, technology, markets and investment with Beijing – accounting for one-third of China's total trade volume, or US$1.89 trillion last year. Meanwhile, some of them may need security assurances from the US amid the growing Chinese influence in the region, analysts said. China remains the top trading partner for 18 countries across the region and has been the largest trading partner of the Association of Southeast Asian Nations (Asean) for 15 consecutive years. Meanwhile, economic asymmetry and military advantage have often translated into Beijing's leverage in market power while, for many in the region, Washington represents security, diversification and strategic rebalancing, with its military presence, investment and advanced technology, analysts said. That leaves many Asian economies walking a tightrope – benefiting from China's vast market while remaining wary of the risks of over-dependence. For much of Asia, maintaining ties with both while caught in between has become a survival strategy.
Yahoo
06-06-2025
- Business
- Yahoo
Trump-Xi call restores trade truce. But the supply chain war has no end in sight
The fragile trade truce between the United States and China has, for now, been pulled back from the brink. US President Donald Trump finally got his long-anticipated phone call with Chinese leader Xi Jinping, during which the two agreed to resume trade talks that had stalled over accusations from each side that the other had reneged on previous promises. Thursday's 90-minute conversation brought a temporary reprieve from an escalating feud between the superpower rivals, but it offered no clear path toward resolving their deep-rooted divisions – especially over crucial supply chains that both sides consider vital to national security. US officials accused China of backpedaling on its pledge made during May talks in Geneva to ease export restrictions on rare earth minerals critical to a wide range of industries. Beijing, meanwhile, has bristled at Washington's moves to warn companies against using China's most advanced AI chips, restrict chip design software sales to China and 'aggressively revoke' Chinese student visas. 'After what happened during the past 10 days, I already call (the phone call) a win,' said Yun Sun, director of the China program at the Washington-based Stimson Center think tank. 'Both sides acknowledge that this was a positive interaction, and the two leaders coming together can solve problems. It's good for their strong man image and leadership credentials.' While Trump had repeatedly expressed keenness for the call, including complimenting Xi's toughness in a late-night social media post this week, Xi has taken his time in picking up the phone. 'The Chinese state is under significantly less pressure than its American counterpart in coming to the negotiating table,' said Brian Wong, an assistant professor at the University of Hong Kong. 'The Chinese leadership joined the call from a position of political strength, even whilst economic concerns are very much alive and real.' Trump's eagerness to talk – and his speediness in declaring that he had 'straightened out' the dispute over rare earth exports with Xi – has once again demonstrated to the Chinese leader just how powerful his nation's dominance in the sector is. Since April, when China announced the export controls, the new system has disrupted the shipment of the minerals, raising alarms among officials and businesses alike in Europe and America. In the Chinese readout, Xi insisted that China had 'seriously and earnestly' complied with the agreement, even as US officials have repeatedly accused Beijing of slow-walking approvals for rare earth exports. Wu Xinbo, director of the Center for American Studies at Fudan University in Shanghai, noted that official rules dictate that applications for export licenses can take up to 45 working days to be approved. 'In principle, I can agree to export to you, but I can speed things up or slow them down. In reality, on a technical level, it also depends on the overall bilateral trade and economic atmosphere,' he said. 'If the bilateral relationship is good, then I'll go a bit faster; if not, I'll slow down. But you can't say I'm violating the agreement — I'm still following the standard procedures.' While American businesses are likely to see more export licenses approved in the next couple of weeks, according to Wu, the export control regime is here to stay. Zhiqun Zhu, director of the China Institute at Bucknell University in Pennsylvania, put it more bluntly, calling China's dominance on rare earths 'one of the few cards' it holds in the trade war. 'Why would the US government expect China to give up the rare earth card to please the US if it treats China as the enemy?' he wrote in an article prior to the Trump-Xi call. In the days leading up to the phone call, Chinese scholars have suggested that Beijing should use its leverage on rare earths to get Washington to ease its own export controls on cutting-edge chips. Unlike rare earths, China doesn't dominate this industry at the highest levels, and it views any supply bottleneck on the US side as an obstacle to its technological development. Following his conversation with Xi, Trump announced that Commerce Secretary Howard Lutnick will join Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer in the next round of trade talks. That was noted by observers in both China and the US as a sign that US export controls may now be up for negotiation in a potential win for Beijing. 'The US Department of Commerce is responsible for export controls, which means that in the next stage, China-US negotiations will likely go beyond tariffs and also address issues such as export controls and entity sanctions,' Wu said. During his first term in office, Trump lifted a ban on American companies doing business with Chinese telecom giant ZTE at Xi's request to get a trade deal. But six years on, easing export controls on China will be a tough sell in Washington, where blocking Beijing's access to advanced American technologies has become a rare bipartisan issue. 'Just having Lutnick there (in the trade talks) doesn't mean that the US is going to make concessions on semiconductors,' Sun said. She predicts more flare-ups of tensions down the road. 'This 'three steps forward two steps back' is going to be the norm from now on. We're not going to see a deal agreed without any drawbacks, and we're going to see this repeating itself,' she added. While the call signaled temporary relief, it also exposed stark differences in how the US and China approach their trade disputes: Trump tends to treat trade as a primary and standalone issue, whereas Beijing often views it in the context of broader bilateral relations. Trump said in his Truth Social post that the hour-and-a-half conversation phone call was 'focused almost entirely on TRADE,' while the Chinese readout singled out Xi's stern warning on Taiwan – the reddest of lines for Beijing – and the issue of Chinese student visas. The Chinese leader urged the US to 'handle the Taiwan question with prudence' so that ''Taiwan independence' separatists' will not be able to 'drag China and America into the dangerous terrain of confrontation and even conflict.' The contrast strikes at the core of the gulf between China and the US, Wong said. 'Whilst Trump views the competition through primarily trade surplus/deficit terms, Xi views territorial integrity as … more important than the country's economic interests,' he said. From Beijing's perspective, there are plenty of worrying signs. Last weekend, US Defense Secretary Pete Hegseth warned Asian allies that China posed an 'imminent' threat to Taiwan, a self-governing democracy Beijing views as its own and has vowed to take control of, by force if necessary. Days before, Reuters had reported, citing US official sources, that Washington plans to ramp up weapon sales to Taipei to a level exceeding Trump's first term as part of an effort to deter China's intensifying military pressure. Another issue of concern for Beijing is the fate of Chinese students in the US. Last week, Secretary of State Macro Rubio, a known China-hawk, announced a plan to 'aggressively revoke' visas for Chinese students, a move that has caused widespread anxiety and anger in China. The Chinese readout quoted Trump as saying that Chinese students are welcome in the US. Trump later told reporters in the Oval Office: 'Chinese students are coming. No problem. No problem. It's our honor to have them.' Wu said the adjustment of the visa policy will be a test of Trump's leadership. During their call, Xi told Trump that the two leaders should 'take the helm and set the right course' for bilateral relations, saying it's particularly important to steer clear of 'various disturbances and disruptions.' 'This remark had a clear target – it implies that within Trump's team, there are people trying to disrupt or undermine the bilateral relationship, so now it's up to President Trump to show leadership,' Wu said.
CNN
06-06-2025
- Business
- CNN
Trump-Xi call restores trade truce. But the supply chain war has no end in sight
The fragile trade truce between the United States and China has, for now, been pulled back from the brink. US President Donald Trump finally got his long-anticipated phone call with Chinese leader Xi Jinping, during which the two agreed to resume trade talks that had stalled over accusations from each side that the other had reneged on previous promises. Thursday's 90-minute conversation brought a temporary reprieve from an escalating feud between the superpower rivals, but it offered no clear path toward resolving their deep-rooted divisions – especially over crucial supply chains that both sides consider vital to national security. US officials accused China of backpedaling on its pledge made during May talks in Geneva to ease export restrictions on rare earth minerals critical to a wide range of industries. Beijing, meanwhile, has bristled at Washington's moves to warn companies against using China's most advanced AI chips, restrict chip design software sales to China and 'aggressively revoke' Chinese student visas. 'After what happened during the past 10 days, I already call (the phone call) a win,' said Yun Sun, director of the China program at the Washington-based Stimson Center think tank. 'Both sides acknowledge that this was a positive interaction, and the two leaders coming together can solve problems. It's good for their strong man image and leadership credentials.' While Trump had repeatedly expressed keenness for the call, including complimenting Xi's toughness in a late-night social media post this week, Xi has taken his time in picking up the phone. 'The Chinese state is under significantly less pressure than its American counterpart in coming to the negotiating table,' said Brian Wong, an assistant professor at the University of Hong Kong. 'The Chinese leadership joined the call from a position of political strength, even whilst economic concerns are very much alive and real.' Trump's eagerness to talk – and his speediness in declaring that he had 'straightened out' the dispute over rare earth exports with Xi – has once again demonstrated to the Chinese leader just how powerful his nation's dominance in the sector is. Since April, when China announced the export controls, the new system has disrupted the shipment of the minerals, raising alarms among officials and businesses alike in Europe and America. In the Chinese readout, Xi insisted that China had 'seriously and earnestly' complied with the agreement, even as US officials have repeatedly accused Beijing of slow-walking approvals for rare earth exports. Wu Xinbo, director of the Center for American Studies at Fudan University in Shanghai, noted that official rules dictate that applications for export licenses can take up to 45 working days to be approved. 'In principle, I can agree to export to you, but I can speed things up or slow them down. In reality, on a technical level, it also depends on the overall bilateral trade and economic atmosphere,' he said. 'If the bilateral relationship is good, then I'll go a bit faster; if not, I'll slow down. But you can't say I'm violating the agreement — I'm still following the standard procedures.' While American businesses are likely to see more export licenses approved in the next couple of weeks, according to Wu, the export control regime is here to stay. Zhiqun Zhu, director of the China Institute at Bucknell University in Pennsylvania, put it more bluntly, calling China's dominance on rare earths 'one of the few cards' it holds in the trade war. 'Why would the US government expect China to give up the rare earth card to please the US if it treats China as the enemy?' he wrote in an article prior to the Trump-Xi call. In the days leading up to the phone call, Chinese scholars have suggested that Beijing should use its leverage on rare earths to get Washington to ease its own export controls on cutting-edge chips. Unlike rare earths, China doesn't dominate this industry at the highest levels, and it views any supply bottleneck on the US side as an obstacle to its technological development. Following his conversation with Xi, Trump announced that Commerce Secretary Howard Lutnick will join Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer in the next round of trade talks. That was noted by observers in both China and the US as a sign that US export controls may now be up for negotiation in a potential win for Beijing. 'The US Department of Commerce is responsible for export controls, which means that in the next stage, China-US negotiations will likely go beyond tariffs and also address issues such as export controls and entity sanctions,' Wu said. During his first term in office, Trump lifted a ban on American companies doing business with Chinese telecom giant ZTE at Xi's request to get a trade deal. But six years on, easing export controls on China will be a tough sell in Washington, where blocking Beijing's access to advanced American technologies has become a rare bipartisan issue. 'Just having Lutnick there (in the trade talks) doesn't mean that the US is going to make concessions on semiconductors,' Sun said. She predicts more flare-ups of tensions down the road. 'This 'three steps forward two steps back' is going to be the norm from now on. We're not going to see a deal agreed without any drawbacks, and we're going to see this repeating itself,' she added. While the call signaled temporary relief, it also exposed stark differences in how the US and China approach their trade disputes: Trump tends to treat trade as a primary and standalone issue, whereas Beijing often views it in the context of broader bilateral relations. Trump said in his Truth Social post that the hour-and-a-half conversation phone call was 'focused almost entirely on TRADE,' while the Chinese readout singled out Xi's stern warning on Taiwan – the reddest of lines for Beijing – and the issue of Chinese student visas. The Chinese leader urged the US to 'handle the Taiwan question with prudence' so that ''Taiwan independence' separatists' will not be able to 'drag China and America into the dangerous terrain of confrontation and even conflict.' The contrast strikes at the core of the gulf between China and the US, Wong said. 'Whilst Trump views the competition through primarily trade surplus/deficit terms, Xi views territorial integrity as … more important than the country's economic interests,' he said. From Beijing's perspective, there are plenty of worrying signs. Last weekend, US Defense Secretary Pete Hegseth warned Asian allies that China posed an 'imminent' threat to Taiwan, a self-governing democracy Beijing views as its own and has vowed to take control of, by force if necessary. Days before, Reuters had reported, citing US official sources, that Washington plans to ramp up weapon sales to Taipei to a level exceeding Trump's first term as part of an effort to deter China's intensifying military pressure. Another issue of concern for Beijing is the fate of Chinese students in the US. Last week, Secretary of State Macro Rubio, a known China-hawk, announced a plan to 'aggressively revoke' visas for Chinese students, a move that has caused widespread anxiety and anger in China. The Chinese readout quoted Trump as saying that Chinese students are welcome in the US. Trump later told reporters in the Oval Office: 'Chinese students are coming. No problem. No problem. It's our honor to have them.' Wu said the adjustment of the visa policy will be a test of Trump's leadership. During their call, Xi told Trump that the two leaders should 'take the helm and set the right course' for bilateral relations, saying it's particularly important to steer clear of 'various disturbances and disruptions.' 'This remark had a clear target – it implies that within Trump's team, there are people trying to disrupt or undermine the bilateral relationship, so now it's up to President Trump to show leadership,' Wu said.
