The Triumph at Davos

Let’s give credit where credit is due: at the 2026 World Economic Forum in Davos, Prime Minister Mark Carney received a rare standing ovation for an excellent speech. In a room usually reserved for the platitudes of elite globalists, Carney delivered a moving assessment of a broken international order. He declared the US-led rules-based order dead, warned against “living within the lie” of integration [within American hegemony], and called for middle powers to find a third path through the dangers of great power rivalry.

The applause was thunderous. The reviews from The New York Times to The Guardian were glowing. But as the private jets left the Swiss Alps, a nagging question remains for Canadians back home: Is Mark Carney a truly visionary leader for Canada, or simply a talented orator with a doctorate in economics?

The Beijing “Bargain”

The most jarring disconnect occurred just days before Davos, during Carney’s high-stakes mission to Beijing. To secure a reset in relations, the Prime Minister announced forging a new “Strategic Partnership” focused on EVs, agriculture and energy. While Carney presented this as a landmark win for Canada, the reality is a lopsided trade-off.

Canada offered immediate, concrete concessions: slashing tariffs on 49,000 Chinese electric vehicles. Beijing’s side of the ledger remains largely aspirational, with the language of “Canada expects that…” rather than “China will…” Despite the fanfare, there is nothing in writing that agrees to, or promises, an end to China’s punitive measures on Canadian canola and pork. Rather, Ottawa secured only a vague Joint Statement and non-binding Memorandums of Understanding. Carney appears to have traded tangible Canadian leverage for a collection of expectations – which Beijing can ignore or revoke at its leisure. The PM media release titled “Roadmap” presented a road on which Canada is driving alone.

Values vs. Transactions

More troubling is the geopolitical cost of this mission. The PM’s January 16 media release indicates that in his eagerness to appease President Xi, Carney “reaffirmed Canada’s longstanding commitment to its “One China policy”, effectively throwing Taiwan under the bus to appease China.

This commitment contradicts Carney’s ethical affirmation in Davos that Canada remains “principled in our commitment to fundamental values, sovereignty, territorial integrity, the prohibition of the use of force”. By denying Canada’s support for a fellow middle-power democracy at a moment of China’s heightened threat of military force, Carney has signaled that Canada’s “strategic autonomy” is for sale – at a low price. It is a striking irony: in Switzerland he spoke of defending middle powers against coercion; in China, he seemed perfectly willing to let China threaten the sovereignty and territorial integrity of Taiwan, another middle power, if it meant a photo-op with Xi Jiping and an expectation of some tariff reductions by China.

At Davos Carney commented that “A country that can’t feed itself, fuel itself or defend itself, has few options”. That may explain why he thought his best option was to kowtow to China, even in return for not much more than hopeful expectations and continued dialogue.

The Domestic Disconnect

At home, the voters’ hope that an experienced central banker would bring economic stability and greater prosperity is facing a stress test. In Davos, Carney boasted of “fast-tracking” a trillion dollars in investment. Yet, for the average Canadian, these investments, if and when the private sector will make them, have not translated into relief from the rising costs of groceries, energy and housing. Carney appears far more effective when addressing a room of billionaires and politicians in the Alps than he has done addressing the kitchen-table anxieties of voters in Windsor or Calgary.

The US Response

A few days after Davos, Trump threatened a 100% tariff on all Canadian goods destined for the US if Canada creates a free trade agreement with China. That threat may be validated by CUSMA Article 32.10, which was specifically designed to prevent any CUSMA member (Canada or Mexico) from entering into a free trade agreement with a “non-market economy” like China. Under this article, if Canada intends to start trade negotiations with a non-market economy, it must notify the U.S. and Mexico three months in advance. If Canada gave this notice it was privately, as it was not announced in public.

If Canada actually signs such a free trade deal, the other members (the U.S. and Mexico) have the right to terminate CUSMA on six months’ notice and replace it with a bilateral agreement between themselves, effectively kicking Canada out of the North American trade bloc. However, in response to Trump’s threat, on January 24 and 25, both Minister Dominic LeBlanc and the PM quickly insisted that Canada has no intention of pursuing a free trade agreement with China or any other non-market economy. LeBlanc:

” What we’ve done with China is to rectify some issues that developed in the last couple of years.”

Whether Trump accepts this explanation in light of the PM’s earlier announcement of a new “Strategic Partnership” on trade with China – which could be mistaken for a free trade deal – remains to be seen.

Performance Over Policy

A great speech is not a foreign policy; nor is it a domestic policy. Carney told his Davos audience that “nostalgia is not a strategy.” He is right. But neither are eloquent speeches.

Our Prime Minister has persuasively diagnosed the sickness of the global order. However, to truly walk the walk he must prove that Canada’s strategic autonomy is more than a tagline for the international speaking circuit. If Carney cannot quickly align his domestic actions and his transactional concessions to an authoritarian Chinese regime with his global prescriptions he risks becoming the ultimate “Davos Man”: a leader who can explain the world perfectly, but lacks the political will to protect his own corner of it.