At the APEC summit in South Korea, Canadian Prime Minister Mark Carney declared that the era of rules-based free trade and investment is over. Warning that the postwar economic model no longer fits a world undergoing rapid geopolitical and technological change. Speaking in Gyeongju, Carney emphasized that Canada would shift away from its reliance on the U.S., aiming to double non-U.S. exports within the next decade.
Strengthening Ties with China Amid Global Shifts
In a historic meeting with Chinese President Xi Jinping, the first between Canadian and Chinese leaders since 2017, Carney expressed his desire to rebuild relations. Canadian prime ministers want to promote a “sustainable, inclusive international system.” Xi welcomed the rapprochement. President Xi invited Carney to visit China and noted a “positive recovery” in bilateral ties after years of strain under former Prime Minister Justin Trudeau. The meeting took place shortly after Xi and U.S. President Donald Trump reached a truce in their long-standing trade conflict, a move that eased tensions but underscored lingering divisions.
Regional Tensions and Shifting Alliances
While Carney signaled renewed engagement with China, U.S. participation at APEC was limited, as Trump skipped the summit following his agreement with Xi on rare earth minerals and tariffs. The U.S. Treasury Secretary, Scott Bessent, represented Washington, while Defense Secretary Pete Hegseth met Chinese and Indian counterparts at an ASEAN meeting. A move to reaffirm U.S. defense commitments in the Indo-Pacific.
Meanwhile, Japan’s new Prime Minister Sanae Takaichi held a tense first meeting with Xi. Both leaders agreed to pursue a “mutually beneficial relationship” despite ongoing disputes over territory, military buildup, and trade restrictions tied to the Fukushima wastewater issue. Takaichi announced Japan would increase defense spending to 2% of GDP by 2027, signaling a firmer stance toward regional security challenges.
Carney’s remarks and diplomatic outreach reflect a broader realignment in global trade and security, as Canada, China, Japan, and the U.S. navigate a multipolar world marked by economic rivalry, shifting alliances, and strategic uncertainty.
Reference
McCurry, J., & Davidson, H. (2025, November 1). Era of free trade and investment is over, Canada’s PM tells Apec summit. The Guardian. https://www.theguardian.com/world/2025/oct/31/era-of-free-trade-and-investment-over-canada-pm-mark-carney-apec-summit-korea