Mark Carney warns Asia-Pacific leaders global economy undergoing profound change, as China’s president mounts defence of free trade
Mark Carney warns Asia-Pacific leaders global economy undergoing profound change, as China’s president mounts defence of free trade
The Canadian prime minister, Mark Carney, has warned that the era of free trade and investment that formed the foundations of the postwar global economy has ended.
In a stark message to Asia-Pacific leaders at the Apec summit in South Korea on Friday, Carney said rules-based open trade no longer worked in a global economy that was undergoing one of its most profound periods of change since the fall of the Berlin Wall in 1989.
“The old world of steady expansion of rules-based liberalised trade and investment, a world on which so much of our nations’ prosperity – very much Canada’s included – is based, that world is gone,” Carney told a business event on the opening day of the summit in the historical town of Gyeongju.
Carney indicated that Canada would edge away from its traditional dependence on trade with the US, saying it aimed to double non-US exports over the next decade.
Later, in the first formal meeting between Canadian and Chinese leaders since 2017, Carney said he looked forward to working more closely with the Chinese leader, Xi Jinping, to “help build a more sustainable, inclusive international system”.
Xi invited Carney to visit China, adding that ties between the two countries had shown signs of recovery after years of tension under Carney’s predecessor, Justin Trudeau. “Recently, with the joint efforts of both sides, China-Canada relations have shown a recovery toward a trend of positive development,” Xi told Carney.
“China is willing to work with Canada to bring China-Canada relations back to the right track.”
Carney responded: “I also welcome the invitation to come to China to further the dialogue and I very much look forward to doing so,” adding that he looked forward to “constructive and pragmatic dialogue”.
His declaration of the demise of “rules-based” free trade came days after Xi and Donald Trump backed away from an all-out trade war – a truce that was greeted with relief by world leaders, but which was also a reminder of deep-seated differences between the leaders of the world’s two biggest economies.
Carney said earlier this month that Canada would resume trade negotiations with the US only “when the Americans are ready” – an apparent reference to Trump’s decision to immediately end “all trade negotiations” over a television advertisement opposing US tariffs that quoted the former US president Ronald Reagan.
