Carney and Cabinet Meet in Banff to Chart Canada’s Path Amid New World Order

Embroiled in an escalating trade war with the United States, Prime Minister Mark Carney and his cabinet gathered in Banff to forge a way ahead for Canada amid growing global upheaval.

Ahead of Parliament’s resumption, the government’s cabinet planning forum focused on strengthening the country’s economy and infrastructure, diversifying trade and navigating a turbulent trade relationship with an increasingly confrontational U.S. administration under President Donald Trump.

“We have made bold changes, including new major infrastructure projects, a new Defence Industrial Strategy and a new tax credit to make Canadian businesses more competitive,” Carney said in a statement ahead of the meeting.

“In parallel, the government is rapidly diversifying Canada’s trade and defence relationships abroad. In the face of serious headwinds, the government is not changing course.”

During a break in the sessions, Carney said he remained willing to resume negotiations with the United States in an environment of “professionalism and respect.”

“We’re always ready to sit down in a professional way to negotiate — we think there is a mutually beneficial deal that respects our sovereignty and is in the interests of both countries,” he told reporters.

He said there was a need for “credibility and stability” before negotiations could resume.

Carney also said his government was reviewing its options for responding to the latest round of U.S. tariffs and trade restrictions.

However, he appeared reluctant to retaliate, describing the latest American measures as “relatively modest.”

“The biggest impact we can have here in Canada is to focus on what we can control,” he said.

Carney said Canada was confronting Washington “from a position of strength,” pointing to better job-creation levels than in the United States and strong investment rates.

“And for an investor, wherever they’re from, (Canada’s) a country that respects the rule of law, a country that is reliable,” Carney said.

Trade War and Alberta Referendum on the Agenda

The Canadian side suspended trade negotiations with the United States, saying last-minute additions to the American bargaining position amounted to an attack on Canada’s sovereignty and culture. The move was followed by Washington imposing previously threatened 50 per cent tariffs on some Canadian imports.

Canada subsequently responded with nearly $28 billion in targeted retaliatory tariffs. Washington then announced additional measures, which Carney described as modest but acknowledged would be painful for the industries affected.

The measures included a ban on Canadian alcohol, motorcycles and some dairy products, as well as excluding Canadians from certain U.S. government contracts.

Also on the minds of federal ministers is Alberta’s upcoming referendum on the possibility of a binding vote on separating from Canada.

Federal cabinet ministers have made several visits to Alberta in recent weeks, including Agriculture Minister Heath MacDonald, Industry Minister Melanie Joly and Energy Minister Tim Hodgson.

Asked whether he was concerned that the pro-Canada side could be out-organized and heavily outspent, Carney said he would not commit government financial resources to its efforts.

“There’s a very high degree of awareness in Alberta, of the referendum,” Carney said, noting that high levels of advance voting could indicate that awareness may be more important than spending.

“It’s about people, it’s about participation.”

Canada and Ukraine Commit to Partnership

The war in Ukraine also took centre stage during the Banff meeting, as Ukrainian President Volodymyr Zelenskyy briefed Canadian officials and received renewed commitments of support for his country’s fight against Russia.

Zelenskyy addressed cabinet in Banff after appearing alongside Carney in Calgary.

His visit comes as Ukraine faces increasingly heavy Russian drone and missile attacks against its cities and continues to deal with pressure on its air-defence system.

During their Calgary meeting, Canada and Ukraine signed three declarations covering a 100-year partnership, cooperation on energy, and defence and security.

Cooperation in drone production and technology sharing was a major focus, while the two countries also discussed strengthening Canada’s military capabilities.

“The leaders announced a series of new initiatives to bolster Canada’s sovereign drone capabilities, expand co-production with Ukraine, and establish long-term co-operation on defence and security,” the Prime Minister’s Office said.

As Carney accompanied Zelenskyy after the meeting, the two leaders agreed to meet again in the coming days.

Bremmer Says Carney Has Longer Time Frame Than Trump

American political scientist Ian Bremmer, who participated in the forum, cautioned Canada against engaging in personal attacks on President Trump or demanding apologies for his aggressive rhetoric.

Bremmer argued that Trump was facing a difficult political environment that could shift further following the U.S. midterm elections, potentially creating an opportunity for the trade dispute to ease.

“You’re going to find a lot more people globally who are much more willing to say ‘no more,’ because they see that their own political legacies are much more with the United States and much less with President Trump,” Bremmer said.

He said Canada’s decision to retaliate against U.S. tariffs was the right one and argued that the amount of time Carney’s government has available could work in Canada’s favour.

“There is a much longer time frame that Mark Carney has, that this government has, than President Trump does,” Bremmer said.

Carney previously made international headlines when he argued at the World Economic Forum in Davos that middle powers need to work together to resist pressure from larger states.

Canada remains heavily dependent on the U.S. market, with its exports to the United States valued at nearly US$409 billion, compared with about $31 billion in exports to the European Union. Canadian petroleum product exports to the U.S. were valued at approximately $157.5 billion.

Carney’s efforts to strengthen economic ties abroad and at home are expected to continue, including through an investment forum in Toronto and further discussions with European leaders on Canada’s relationship with the European Union.

The cabinet retreat also comes as the government enjoys relatively strong political support, with a recent Angus Reid poll showing the governing Liberals ahead of the opposition by 14 points.

The pollster attributed part of Carney’s increased popularity to what it described as a “Trump bump,” with the prime minister’s approval rating nearly twice that of Conservative Leader Pierre Poilievre.