17 June 2025 - 7:00am
Against the imposing backdrop of the Canadian Rockies, the leaders of the G7 are meeting in Kananaskis, Alberta to tackle a growing array of world problems: brutal wars in the Middle East and Ukraine, climate change, and the rise of AI. But perhaps the greatest challenge, with the most immediate impact on the global economy, was right there in the room with them — before he had to cut short his visit to focus on brewing conflict with Iran. US President Donald Trump vows to continue his trade war against the same allied economies represented at the summit, as his counterparts seek ways to respond to his grievances and cut a deal.
Yesterday’s meeting fortuitously fell on the 10th anniversary of Trump’s famous escalator ride, which inaugurated the era of geopolitical disruption that the G7 must now confront. And while France’s Emmanuel Macron is the senior statesman at this year’s meeting, it is the host nation’s leader, Canadian Prime Minister Mark Carney, who most fully embodies the “institutional memory” of the liberal international order, having attended meetings like these for more than a decade as a central bank governor on either side of the Atlantic. His bilateral meeting with Trump yesterday carried tremendous stakes; after an earlier White House encounter established what the President has called “a very good relationship” between the two at a personal level, it remains to be seen whether that will translate into any actual relief for Canada’s increasingly tariff-strangled economy.
To those looking for clarity, Trump yesterday simply reaffirmed what we already knew: that there is a stark philosophical gap between himself and everyone else. At the press event, while standing next to Carney, the US President said that they had “different concepts”: he backs tariffs because they are “simple, easy, precise”, while “Mark has a more complex idea but also very good.”
As his US-Canada friendship pin glimmered before photographers, Trump teased that a deal was doable, even within days (an unlikely prospect). He veered off into a characteristic stream of consciousness on everything from re-inviting Vladimir Putin (“it’s always been the G8”), to attacking Democratic cities over immigration, to being noncommittal over what to do on the brewing Israel-Iran war. An uneasy-looking Carney stepped in to end the event, before beginning the meeting at which more nice words were reportedly exchanged.
But how much longer the suspense-laden pleasantries can continue without yielding tangible results is anyone’s guess. Already, unemployment in Canada is ticking upward as jobs begin to evaporate from trade-exposed sectors, while a recession looms on the horizon. Carney’s promise to make Canada “the fastest growing economy” in the G7 becomes exponentially more difficult to execute if he does not stanch the bleeding.
Even as the alluring prospect of diversification — represented by European leaders such as Macron and Germany’s Frederich Merz — offers an escape hatch from over-reliance on the US market, Carney must forge a settlement that restores some semblance of normality between the two North American states, or else he won’t have much of an economy left to diversify. The summit concludes today and the bar for success remains low. But in the long run, neither Carney nor any other leader in attendance can rely on good vibes alone.
