Mark Carney's Davos Speech: A Transatlantic Breakup
- Cha Yu Han
- 1 day ago
- 8 min read
Cover image by Yang Ruimin.
*This article is published in collaboration with Doomscroll Diplomacy, your next one-stop platform for all things foreign affairs. Check out Doomscroll Diplomacy's telegram channel here.
On Canadian-U.S. relations
On 21st January 2026, Canadian Prime Minister Mark Carney delivered an impactful speech at the World Economic Forum in Davos, Switzerland. “The old order is not coming back,” he declared, describing how the international rules-based order is in the midst of a “rupture, not a transition”.
He further urged fellow middle powers to band together amidst a world where great powers have begun using economic integration as “weapons”, citing examples where tariffs have been used as leverage, and financial infrastructure as coercion.
His speech, with its outright criticism of “American hegemony”, elicited respect and admiration from some for its honesty on the state of the world today. Mark Rutte, the Secretary General of NATO, said that the speech had signified Canada’s return as a key NATO player and a leader on the world stage.
While his speech had been widely lauded, it drew criticism from United States President Donald Trump, who although had not been named directly, took offense anyway. A day after Carney’s speech, Trump responded that Carney should “be grateful”. Referring to him by his first name, Trump had also retaliated by saying that “Canada lives because of the United States”, adding that Canada “gets a lot of freebies” from the U.S.
Carney’s speech and the reaction it had elicited continued to draw concern from U.S. ministers and Canadian corporate leaders alike. In an interview with an American television network, U.S. Treasury Secretary Scott Bessent warned Carney to “do what he thinks is best for the Canadian people”, and not to “pick a fight” with Trump.
But if a “fight” is to be had between the two neighbouring countries, it is worth considering whether Carney’s speech had started it at all. Trump had previously placed tariffs of 35 percent on all Canadian goods not traded under the United States-Mexico-Canada Agreement (USMCA) as “leverage”, as Carney had described in his speech. Trump went on to threaten new 100% tariffs on Canada over their possible trade deal with China, placing further strain on the two countries’ relationship.
However, it is, perhaps, also reasonable for Carney to be wary of how Canadian actions might impact relations with the United States. After all, apart from sharing a 9000-kilometre land border, the U.S. remains Canada’s No. 1 trading partner. Additionally, with the USMCA Joint Review which determines whether to extend the agreement taking place soon, it would be prudent to avoid straining the two countries’ relations further. The agreement is also vital for Canada’s economy, giving small and medium-sized businesses preferential access to the North American market, which supports over $1 trillion in trade.
At the same time, allowing the American president’s potential for anger to dictate Canadian leaders’ actions risks ceding a great amount of power. And Carney had, in his speech, pledged to remain “principled” in Canada’s commitment to “sovereignty and territorial integrity”. He began with first expressing his firm support of Greenland and Denmark’s sovereignty in response to Trump’s threats to annex Greenland, reiterating in Davos that Canada "stood firmly with Greenland”.
That is more than can be said for Europe’s feeble attempts to turn President Trump’s hungry gaze away from Greenland. While some European leaders have signed a letter affirming Greenland’s sovereignty, they have failed to call him out more forcefully or articulate any solid counter threat, equivocating and using euphemisms to gently voice their disquiet.
Europe’s reluctance to act outrightly against Trump could also be seen in Europe’s military deployment of troops to Greenland - if the total of 37 officers sent could be considered a troop at all. In comparison to the 200 US troops currently stationed there, European numbers pale greatly, leading some to question the effectiveness of Europe’s incremental increase in military presence.
Canada’s recent willingness to take a firm stand against its neighbour and closest ally thus signifies an obvious turning point in Canadian-US relations. It implies that Canada might not be willing any more to follow the lead of a “hegemon” like the U.S. How, then, does Canada intend to operate on the global stage? And if Carney’s speech possibly means new alliances for Canada, what might they look like?
The Rise of the Middle Power
If Carney’s speech signified a deliberate opposition of American hegemony, it is clear that he did not intend to go at it alone.
Carney had called for the “middle powers” of the world to rally together in an increasingly volatile world, and pledged to engage “broadly” and “strategically”. Having first solidified its role as a “middle power” post-World War 2, the term has been key to Canadian identity and showed that the country possessed sufficient strength and authority to stand on its own without the need for help from others.
These “middle powers” were at the heart of multilateralism, seeking to curtail the capacity of global superpowers while advancing global stability. At this moment of global turbulence, with the United States’ volatile nature threatening the international order, it seems that middle powers could be key in advancing international cooperation and global security.
It is this collective “middle-power activism” that Carney aspires to and hints at in his speech. “We are entering an era of ‘variable geometry’”, he explained in The Economist, referring to an era ripe for collaboration between middle powers, majority of whom have an abiding interest in a functioning multilateral system.
Carney has clearly decided to herald it. In a quest to diversify his allies and signal his dedication to Canada’s shift away from the U.S, he struck a deal with China which would come into effect by 1 March 2026. It represents a significant shift away from Canadian foreign policy, which for so long had been shaped by that of its closest ally, the U.S.
The deal would see Canada lower tariffs on Chinese electric vehicles, while China would lower retaliatory tariffs on Canadian agricultural products. Carney told reporters that his move to “recalibrate” Canada’s relationship with China “strategically” would set Canada up “well for the new world order”. With Canada’s largest trading partner, the U.S., becoming increasingly economically unpredictable, this move prevents Canada from being exclusively aligned with its neighbour. Instead, Canada is now hedging its bets by further diversifying its economic and political ties, allowing it to increase its strategic autonomy.
This deal may just be the first step in a "recalibration" of Canada's trade relations, though. Carney added that Ottawa would soon seek to “advance trading relationships with global giants”, like India, ASEAN, and the South American trade bloc Mercosur.
Clearly, Carney has recognised that continuously trying to placate Washington and bearing the consequences of Trump’s rough-housing is not the way to go. For Canada, the best route now would perhaps not to exclusively align itself with the U.S., but rather redefine its role as a “middle power” by strategically diversifying its allies, thus increasing its bargaining power with Washington.
A Transatlantic Breakup
Canada would not be alone in denouncing the United States’ position as a reliable superpower, however. Across the Atlantic, it seems the European leaders have grown tired of Trump’s antics, as seen in this year’s Munich Security Conference.
The root of their discontent was Marco Rubio’s speech on 14 Februrary this year as Washington’s chosen representative. Though his more reassuring speech, with diplomatic references to German beer and the Beatles, posed a striking contrast to JD Vance’s blistering attack on European leaders, critics scorn that both their speeches echoed a similar rhetoric.
“We believe…that our destiny is and will always be intertwined with [Europe’s],” said Rubio, before moving on to more pressing topics at hand: namely, mass migration “destabilizing societies” and threatening “the continuity of our culture” and a “climate cult” imposing energy policies, to name a few. He outlined a nationalistic vision whereby the Americas and Europe are tied “spiritually” by ancestry and religion.
The Guardian’s Patrick Wintour gives us a playful take on transatlantic relations, stating that if JD Vance’s thuggish speech marked the start of a transatlantic breakup, this year’s conference was where the debate about the terms of the divorce settlement got underway.
Indeed, the conference saw an increasing number of European leaders willing to confront, or at least end the dependence on, the United States. Keir Starmer spoke of a stronger independent European pillar of NATO, and praised social diversity, opposite from what Rubio said on mass migration threatening social cohesion and the continuity of culture. Friedrich Merz, the German chancellor, said the era of US hegemony was coming to an end, and firmly condemning tariffs and protectionism.
The European leaders’ steely conviction of their own stance in Munich marked a notable shift from the placating and equivocating tone they had previously taken with Trump. It is also entirely possible that Carney’s firmly inspirational speech that laid bare the painful truths of today’s world gave fresh impetus to European leaders to harden their newfound resolve.
Regardless of its catalyst, the change of heart in some European leaders has already begun to reflect in their actions. France and the UK are discussing how they could make their nuclear deterrents available to Europe, thus reducing the need for the U.S. nuclear umbrella. The UK and Italy are each taking over Nato commands from the U.S., an important step in establishing a European pillar of defence. It is true that Europe still leans heavily on the U.S. for strategic military support, but ultimately, it has prudently begun to reposition itself in the event that American friendship becomes transactional or conditional.
Carney was right in that the world is currently undergoing a rupture, and not just in the sense of the trusty rules-based order. A fissure of dissent is growing in the ranks of Western civilisation, and only time will tell if the divide will be bridged, or if the gulf will widen further.
References
Carney, M. (2025, November 12). The world is in a new age of variable geometry, says Mark Carney. The Economist. https://www.economist.com/the-world-ahead/2025/11/12/the-world-is-in-a-new-age-of-variable-geometry-says-mark-carney
Kirby, P. (2026, January 16). European military personnel arrive in Greenland as Trump says US needs island. BBC. https://www.bbc.com/news/articles/cd0ydjvxpejo
Martin, T. (2026, February 10). NATO shake-up sees US ousted from 2 warfighting-level commands. Breaking Defense. https://breakingdefense.com/2026/02/nato-shake-up-sees-us-ousted-from-2-warfighting-level-commands/
Patrick, S. (2026, January 20). The Middle Power Moment. Carnegie Endowment for International Peace. https://carnegieendowment.org/russia-eurasia/research/2026/01/the-middle-power-moment
Rubio, M. (2026, February 14). Secretary of State Marco Rubio at the Munich Security Conference - United States Department of State. United States Department of State. https://www.state.gov/releases/office-of-the-spokesperson/2026/02/secretary-of-state-marco-rubio-at-the-munich-security-conference
Saunders, B., & Sperrfechter, K. (2026, February 18). A primer on the USMCA joint review. Capital Economics. https://www.capitaleconomics.com/publications/us-economics-update/primer-usmca-joint-review
Tidey, A. (2026, February 25). Macron to outline France’s role in Europe’s nuclear deterrence. Euronews. https://www.euronews.com/my-europe/2026/02/25/macron-to-outline-frances-contribution-to-europes-nuclear-deterrence
Wherry, A. (2026, January 31). Was Mark Carney’s Davos speech a mistake if it upset Trump? CBC. https://www.cbc.ca/news/politics/carney-davos-speech-trump-analysis-9.7068843
Wintour, P. (2026, February 15). Offer to join Trump’s new era is met with growing sense of European steeliness. The Guardian. https://www.theguardian.com/world/2026/feb/15/offer-to-join-trumps-new-era-is-met-with-growing-sense-of-european-steeliness
Yousif, N. (2026a, January 17). Canada’s deal with China signals it is serious about shift from US. https://www.bbc.com/news/articles/cm24k6kk1rko
Yousif, N. (2026b, January 21). Carney says the old world order “is not coming back” in Davos speech. BBC. https://www.bbc.com/news/articles/cly3d28p4p8o
Yousif, N. (2026c, January 22). “Canada lives because of US”, Trump digs at Carney in Davos speech. BBC. https://www.bbc.com/news/articles/clymd0d8zvyo
Zimonjic, P. (2026, January 22). Carney’s Davos speech draws reaction from around the world. CBC. https://www.cbc.ca/news/politics/world-leaders-react-carney-speech-9.7056702
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