Allies weigh options amid uncertainties

In the face of escalating unpredictability in US trade and foreign policies, key Commonwealth nations such as Canada and New Zealand are actively pursuing strategies to diversify their economic partnerships. Radhika Desai, a political studies professor at the University of Manitoba, highlighted Canada’s precarious position following decades of deepening reliance on the United States. Desai noted that Canadian elites have historically concentrated their economic focus on the US, a strategy she described as a ‘silent surrender.’ This dependence has proven increasingly costly, particularly under the Trump administration, which renegotiated the North American Free Trade Agreement to Canada’s disadvantage. With the potential of a second Trump term, Prime Minister Mark Carney’s perceived inability to challenge Washington has left many Canadians disenchanted. Desai identified two major obstacles to Canada’s shift away from the US: entrenched economic integration and a ruling class resistant to diversification, especially if it involves closer ties with China. Concurrently, Canadian public sentiment has grown increasingly critical of aligning too closely with the US. Desai attributed Washington’s volatility to deeper structural issues within the US, including decades of financialization and deindustrialization, which have made it politically untenable for any candidate to claim economic success. Trump’s focus on tariffs and blame towards trade, China, and immigrants, rather than addressing neoliberalism, has further exacerbated global uncertainties. Desai emphasized that this unpredictability has lasting consequences, with governments worldwide recognizing that the US is unlikely to become a stable economic partner, even under a future Democratic administration. While Canada remains closely tied to the US, Desai believes a gradual realignment towards a multipolar world is inevitable. In a recent move, Prime Minister Carney attended the ASEAN Summit in Kuala Lumpur, aiming to strengthen trade, technology, and energy partnerships with Southeast Asian nations, signaling Canada’s intent to diversify its economic relationships. Meanwhile, the European Union and Australia are advancing their long-awaited Free Trade Agreement, reflecting a shared commitment to an open, rules-based trading system. New Zealand has also been proactive in diversifying its trade partnerships, recently concluding agreements with the UK and the Gulf Cooperation Council, and engaging in negotiations with India. These efforts underscore a broader trend among global allies to enhance supply chain resilience and reduce vulnerability to market-specific shocks.