Canadian Prime Minister’s Speech at Davos: “The Old Order Is Dead—Middle Powers Should Stop ‘Living in Lies’”
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Canadian Prime Minister’s Speech at Davos: “The Old Order Is Dead—Middle Powers Should Stop ‘Living in Lies’”
The power of the system does not come from its truthfulness, but from everyone's willingness to pretend that it is truthful.
Navigating Web3 tides with focused insightsSource: Phoenix News
Canadian Prime Minister Mark Carney delivered a forceful speech Tuesday at the World Economic Forum in Davos, Switzerland, making a striking declaration: "The old order is not coming back." He stated that the long-standing U.S.-led, rules-based international order has ended, and medium-sized powers like Canada must change their strategies to avoid becoming victims of further coercion by stronger forces.
While not directly naming U.S. President Trump, Carney referred to "American hegemony" and said major powers are increasingly using economic integration as a "weapon." He urged middle powers to stop "pretending the rules still work" and instead pursue genuine strategic autonomy through collective action.
Below is a translated and edited version by Phoenix News “World Affairs”:
We seem to be reminded every day: we are living in an era of great power competition—the so-called "rules-based order" is fading, and the strong do what they will while the weak suffer what they must.
Thucydides' maxim is presented as an inevitable reality, as if it were merely the re-emergence of the natural logic of international relations. Faced with this logic, nations often tend to go with the flow, accommodate each other, avoid trouble, and hope that compliance brings security.
But that is not how it works. So what choices do we have?
In 1978, Czech politician Václav Havel wrote an essay featuring the story of a greengrocer.
Every morning, this shopkeeper placed in his window a sign bearing a symbolic slogan. He didn’t believe in the words. Yet he displayed the sign anyway—to avoid trouble, to show obedience, to keep the peace. And precisely because every shopkeeper on every street did the same, the system endured—not only through violence but also through ordinary people’s participation in rituals they privately knew were false.
Havel called this state “living within a lie.” The strength of the regime does not come from its truthfulness, but from everyone's willingness to pretend it is truthful. And therein lies its fragility: the moment even one person stops performing—when the grocer removes the sign from the window—the illusion begins to crack.
Friends, now is the time for businesses and nations to take down those signs.
For decades, countries like Canada prospered under what we call the “rules-based international order.” We joined institutions, praised their principles, and benefited from their predictability. This allowed us, under their protection, to pursue foreign policies based on values.
We also understood that this so-called rules-based international order was partly fictional: the most powerful nations exempted themselves when convenient, trade rules were asymmetrically enforced, and the application of international law depended on who the accused or victim was.
This fiction was once useful. American hegemony, in particular, helped provide public goods—open sea lanes, a stable financial system, collective security, and institutional frameworks for dispute resolution.
So we put up our signs. We participated in these rituals and largely avoided pointing out the gap between rhetoric and reality.
But that bargain no longer works.
Let me be clear: we are experiencing a rupture, not a transition.
Over the past two decades, successive crises in finance, public health, energy, and geopolitics have exposed the risks of deep global integration. More recently, major powers have begun turning economic integration into a weapon—using tariffs as leverage, financial infrastructure as tools of coercion, and supply chains as exploitable vulnerabilities.
When integration itself becomes the source of your vulnerability, you can no longer live within the lie of “mutual benefit and win-win outcomes.”
Multilateral institutions upon which middle powers depend—the WTO, the UN, climate mechanisms, and the entire institutional architecture for collective problem-solving—are under threat. As a result, many countries have reached the same conclusion: they must build greater strategic autonomy in energy, food, critical minerals, finance, and supply chains. This impulse is understandable.
A country unable to feed itself, power itself, or defend itself has very limited choices. When rules no longer protect you, you must protect yourself.
But we must clearly recognize where this path leads. A world of fortified bunkers will be poorer, more fragile, and less sustainable.
There is also this reality: if great powers abandon even the pretense of rules and values and pursue unconstrained power and interest alone, the gains once achievable through transactional diplomacy will become increasingly difficult to replicate.
Hegemonic powers cannot continuously monetize relationships. Allies will hedge against uncertainty by diversifying, buying "insurance," expanding options, and rebuilding sovereignty—a sovereignty once grounded in rules, now increasingly dependent on resilience against pressure.
You all understand this is classic risk management. Risk management has costs, but the costs of strategic autonomy and sovereignty can be shared. Collective investment in resilience is far cheaper than building separate fortresses. Common standards reduce fragmentation; complementarity creates positive-sum outcomes.
For medium-sized powers like Canada, the question is not whether to adapt to this new reality—we must adapt.
The real question is whether we simply build higher walls, or whether we can aim higher.
Canada was among the first to hear this alarm, prompting us to fundamentally adjust our strategic posture. Canadians understand that our former comfortable assumptions—that geography and alliance membership automatically guarantee prosperity and security—are no longer valid. Our new path is based on what Finnish President Stubb calls “value-based realism.”
In other words, we stand by principles while acting pragmatically. In principle, we firmly defend fundamental values, sovereignty, territorial integrity, adherence to the principle that the use of force is prohibited unless permitted by the UN Charter, and respect for human rights.
Pragmatically, we also recognize that progress is often incremental, interests diverge, and not all partners share all our values.
Therefore, we engage globally with clear-eyed realism—broadly and strategically. We actively confront the real world rather than wait for an ideal one to arrive.
We calibrate the depth of our relationships to reflect our values, while maximizing our influence through wide engagement in today’s fluid and risky world.
We no longer rely solely on the power of values, but also on the value of power itself.
We are building this strength domestically. Since this government took office, we have cut personal income taxes, capital gains taxes, and business investment taxes; eliminated all interprovincial trade barriers at the federal level; and accelerated investments totaling one trillion dollars in energy, artificial intelligence, critical minerals, and new trade corridors. We plan to double defense spending by the end of this decade, advancing this process with a focus on strengthening domestic industries. At the same time, we are rapidly pursuing external diversification.
We have established a comprehensive strategic partnership with the European Union, including joining the European Defense Procurement Mechanism SAFE, and signed 12 trade and security agreements across four continents within six months.
In recent days, we have forged new strategic partnerships with China and Qatar, and are negotiating free trade agreements with India, ASEAN, Thailand, the Philippines, and Mercosur.
We are also doing something else: to address global challenges, we are promoting “variable geometry”—forming different coalitions on different issues based on shared values and interests. On Ukraine, we are one of the core members of the “coalition of the willing,” and one of the largest per capita contributors to defense and security.
On Arctic sovereignty, we stand firmly with Greenland and Denmark, fully supporting their unique right to determine Greenland’s future.
Our commitment to NATO Article 5 is unwavering. We are therefore working with NATO allies—including the “Nordic-Baltic Eight”—to strengthen security on the alliance’s northern and western flanks, including unprecedented Canadian investments in over-the-horizon radar, submarines, aircraft, and ground forces—including ice-capable troops.
Canada firmly opposes imposing tariffs related to Greenland and calls for targeted dialogue to achieve our shared goals of security and prosperity in the Arctic region.
On multilateral trade, we are building bridges between the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU, aiming to create a new trade bloc of 1.5 billion people centered on critical minerals.
We are forming a “buyers’ club” based on the G7 to help the world reduce dependence on highly concentrated supplies. In artificial intelligence, we are collaborating with like-minded democracies to ensure we never face a forced choice between hegemonic powers and oversized platforms.
This is not naive multilateralism, nor mere reliance on existing institutions. It is about building viable coalitions with partners who share sufficient common ground on specific issues. In some cases, this may include the vast majority of the world. The goal is to weave a dense network of connections in trade, investment, culture, and beyond, to meet future challenges and opportunities.
Our view is that middle powers must act together—because if we’re not at the table, we’ll end up on the menu.
Let me add: great powers currently still have the ability to act unilaterally. They possess market size, military capability, and levers of pressure that middle powers lack. But when we negotiate bilaterally only with hegemonic powers, we do so from a position of weakness—accepting whatever is offered, competing with each other to see who is more compliant.
This is not sovereignty—it is performing sovereignty while accepting subordination.
In a world of great power competition, countries caught in the middle face a choice: either compete with each other for favor, or unite to carve out a third path with real influence. We must not let the rise of hard power blind us to the enduring strength of legitimacy, integrity, and rules—so long as we choose to wield them collectively, they remain powerful.
This brings me back to Havel. For middle powers, what does it mean to “live in truth”?
First, it means facing reality head-on. Stop pretending the “rules-based international order” still functions as advertised. Acknowledge openly: this is a system of intensifying great power competition, where the strongest use economic integration to coerce and advance their own interests.
It means acting consistently, applying the same standards to allies and adversaries alike. When middle powers criticize economic coercion from one direction but stay silent about another, we are still putting up our signs in the window.
It means building what we claim to believe in, rather than waiting for the old order to return. It means creating institutions and agreements that actually function as described, reducing the levers that make coercion possible.
It means building a strong domestic economy—this should be the top priority of every government.
And international diversification is not just economic prudence, but the material foundation of honest foreign policy. A country must reduce its vulnerability to retaliation before it can credibly uphold principled positions.
Now, Canada. Canada has what the world needs. We are an energy superpower, with vast reserves of critical minerals, home to one of the best-educated populations in the world. Our pension funds rank among the largest, most mature global investors. In short, we have capital and talent. We have a government with strong fiscal capacity capable of decisive action, and we uphold values admired by many nations.
Canada is a well-functioning pluralistic society. Our public sphere is vibrant, diverse, and free. Canadians remain committed to sustainability. We are a stable and reliable partner in an extremely volatile world—one that values and nurtures long-term relationships.
And here’s another point: we understand what is happening, and we are determined to act accordingly. We know this rupture demands not just adaptation, but honesty about the real world.
We are taking the sign down from the window.
We know the old order will not return, and we should not mourn it. Nostalgia is not strategy. But we believe a larger, better, stronger, and fairer order can emerge from this rupture. This is the task of middle powers—those nations that stand to lose the most in a fortress world, yet gain the most from genuine cooperation.
The strong have their power. But we have ours: the power to stop pretending, to face reality, to build strength at home, and to act collectively.
This is the path Canada has chosen. We walk it openly and confidently—and welcome any nation willing to join us.
Thank you very much.
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