At Davos, Prime Minister Mark Carney delivered a direct assessment of the global backdrop: trade, tariffs, supply chains, and financial systems are increasingly being used as strategic tools, and the old assumptions behind a smooth rules-based order are under strain. His message matters not because it predicts one outcome, but because it highlights the growing role of policy and geopolitics in shaping economic conditions. We are monitoring developments closely as this evolves. 

Carney's Framework in Three Pillars 

Name the shift plainly. He described the moment as a rupture, not a gentle transition. 

Build resilience at home and diversify abroad. He emphasized scaling Canada's domestic capacity while widening Canada's network of partners. 

Form coalitions that actually work, issue-by-issue. He cited ideas such as closer alignment between CPTPP and the EU, buyers' clubs for critical minerals, and cooperation on AI standards. 

 

He also addressed Arctic tensions, backing Greenland and Denmark's right to determine Greenland's future. Reception in Davos was notably strong, with reporting describing unusually high energy and attention - reflecting broader concern that fragmentation is rising and policy risk is more market-relevant than it has been in years. 

Opportunities for Canada 

• More diversified trade and investment through deeper links with Europe and other partners. 
• Tailwinds for critical minerals, energy, and strategic industrial capacity as allies prioritize secure supply chains. 
• Defence and Arctic investment momentum, supporting domestic capability building. 

Risks to Watch 

• Trade friction and tariff risk, especially if rhetoric turns into policy and spills into markets. 
• China tightrope risk, balancing opportunity with security guard rails. 
• Execution risk - strategy only matters if it is delivered. 
• Arctic escalation risk as the region becomes more central to geopolitics. 

Bottom Line 

This is not a pick-a-side story - it is a trade-offs story. We will continue to monitor policy developments and their potential implications for growth, inflation, and risk sentiment.