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Prime Minister Mark Carney earned the praise of world leaders at the World Economic Forum in Davos, however with one glaring exception, President Trump. As one wag put it, “Carney got into Trump’s head” with his speech which, by the way, never once mentioned Trump by name. Carney described the “rupture” with the US over tariffs and most recently over Greenland. True to form, Trump rescinded his invitation to Carney to join Trump’s show piece, Board of Peace, upon learning of Carney’s presentation. For many Canadians, being singled out in this way is considered to be a badge of honour. 

It is necessary to look at the lead up to Carney’s speech at Davos, to better understand his position. Carney just completed a bilateral trade with China. Canada will drop its 100% tariff on EVs from China and permit up to 49,000 Chinese electric vehicles (about 3% of the Canadian auto market) under a preferential tariff rate of 6.1%. This was granted in exchange for China reducing its tariffs on canola products from 85% t 0 15% .Canada, as part of the North American free trade autopact bowed to US pressure, starting from the Biden years and continued under Trump, of putting a 100% tariff on Chinese EVs. This represents the most important breakout from the U.S. stranglehold on Canada since Trump launched his tariffs. 

At home, Carney was asked about working with China, a country which does not hold western values of freedom and democracy. He made it clear that Canada has to live in the world as it exists, not in the world it wishes existed. This is a major departure from the approach adopted by his predecessor Justin Trudeau. 

Mark Carney's speech  opened by stating: 

“ the natural logic of international relations reasserting itself. And faced with this logic, there is a strong tendency for countries to go along, get along to accommodate, to avoid trouble, to hope that compliance will buy safety”.

He argues that the great powers are above any constraints and he then goes on to encourage “middle powers”, such as Canada,to “build a new order”. 

Trump in his own speech subsequently, called Canada “ ungrateful”, implying that the country owes the US so much. In bilateral talks with Canada, the US has not been able to come to any trade deal, and officials are sitting on the sidelines waiting for the negotiation of the North America free trade agreement, US, Canada and Mexico to start later this year. Neither Canada nor Mexico have made any meaningful concessions to the US, much to the annoyance of its aggrieved leader.

For the vast majority of attendees, it was Carney’s realism and a call to arms, so to speak, for middle powers to band together. He stated: 

“We know the old order is not coming back. We shouldn't mourn it. Nostalgia is not a strategy, but we believe that from the fracture we can build something bigger, better, stronger, more just. This is the task of the middle powers, the countries that have the most to lose from a world of fortresses and the most to gain from genuine co-operation.”

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