Canadian prime minister Mark Carney declared the end of the rules-based international system and called on states to unite to better counter the intimidation of “hegemonic powers.” He delivered a hard-hitting speech Tuesday at the World Economic Forum in Davos, Switzerland, which brings together the global economic and political elite.
Never before had a Canadian prime minister gone this far.
Here is a part of his speech:
Today I will talk about a rupture in the world order, the end of a pleasant fiction and the beginning of a harsh reality, where geopolitics, where the large, main power, geopolitics, is submitted to no limits, no constraints.
On the other hand, I would like to tell you that the other countries, especially intermediate powers like Canada, are not powerless. They have the capacity to build a new order that encompasses our values, such as respect for human rights, sustainable development, solidarity, sovereignty and territorial integrity of the various states.
The power of the less power starts with honesty.
It seems that every day we’re reminded that we live in an era of great power rivalry, that the rules based order is fading, that the strong can do what they can, and the weak must suffer what they must.
And this aphorism of Thucydides is presented as inevitable, as the natural logic of international relations reasserting itself.
And faced with this logic, there is a strong tendency for countries to go along to get along, to accommodate, to avoid trouble, to hope that compliance will buy safety.
Well, it won’t.
So, what are our options?
In 1978, the Czech dissident Václav Havel, later president, wrote an essay called The Power of the Powerless, and in it, he asked a simple question: how did the communist system sustain itself?
And his answer began with a greengrocer.
Every morning, this shopkeeper places a sign in his window: ‘Workers of the world unite’. He doesn’t believe it, no-one does, but he places a sign anyway to avoid trouble, to signal compliance, to get along. And because every shopkeeper on every street does the same, the system persist – not through violence alone, but through the participation of ordinary people in rituals they privately know to be false.
Havel called this: “living within a lie”.
The system’s power comes not from its truth, but from everyone’s willingness to perform as if it were true, and its fragility comes from the same source. When even one person stops performing, when the greengrocer removes his sign, the illusion begins to crack. Friends, it is time for companies and countries to take their signs down.
For decades, countries like Canada prospered under what we called the rules-based international order. We joined its institutions, we praised its principles, we benefited from its predictability. And because of that, we could pursue values-based foreign policies under its protection.
We knew the story of the international rules-based order was partially false that the strongest would exempt themselves when convenient, that trade rules were enforced asymmetrically. And we knew that international law applied with varying rigour depending on the identity of the accused or the victim.
This fiction was useful, and American hegemony, in particular, helped provide public goods, open sea lanes, a stable financial system, collective security and support for frameworks for resolving disputes.
So, we placed the sign in the window. We participated in the rituals, and we largely avoided calling out the gaps between rhetoric and reality.
This bargain no longer works. Let me be direct. We are in the midst of a rupture, not a transition.
Over the past two decades, a series of crises in finance, health, energy and geopolitics have laid bare the risks of extreme global integration. But more recently, great powers have begun using economic integration as weapons, tariffs as leverage, financial infrastructure as coercion, supply chains as vulnerabilities to be exploited.
You cannot live within the lie of mutual benefit through integration, when integration becomes the source of your subordination.
The multilateral institutions on which the middle powers have relied – the WTO, the UN, the COP – the architecture, the very architecture of collective problem solving are under threat. And as a result, many countries are drawing the same conclusions that they must develop greater strategic autonomy, in energy, food, critical minerals, in finance and supply chains.
And this impulse is understandable. A country that can’t feed itself, fuel itself or defend itself, has few options. When the rules no longer protect you, you must protect yourself.
But let’s be clear eyed about where this leads.
A world of fortresses will be poorer, more fragile and less sustainable. And there is another truth. If great powers abandon even the pretense of rules and values for the unhindered pursuit of their power and interests, the gains from transactionalism will become harder to replicate.
Hegemons cannot continually monetize their relationships.
Allies will diversify to hedge against uncertainty.
They’ll buy insurance, increase options in order to rebuild sovereignty – sovereignty that was once grounded in rules, but will increasingly be anchored in the ability to withstand pressure.
This room knows this is classic risk management. Risk management comes at a price, but that cost of strategic autonomy, of sovereignty can also be shared.
Collective investments in resilience are cheaper than everyone building their own fortresses. Shared standards reduce fragmentations. Complementarities are positive sum. And the question for middle powers like Canada is not whether to adapt to the new reality – we must. The question is whether we adapt by simply building higher walls, or whether we can do something more ambitious.
Now Canada was amongst the first to hear the wake-up call, leading us to fundamentally shift our strategic posture.
Canadians know that our old comfortable assumptions that our geography and alliance memberships automatically conferred prosperity and security – that assumption is no longer valid. And our new approach rests on what Alexander Stubb, the President of Finland, has termed “value-based realism”.
Or, to put another way, we aim to be both principled and pragmatic – principled in our commitment to fundamental values, sovereignty, territorial integrity, the prohibition of the use of force, except when consistent with the UN Charter, and respect for human rights, and pragmatic and recognizing that progress is often incremental, that interests diverge, that not every partner will share all of our values.
So, we’re engaging broadly, strategically with open eyes. We actively take on the world as it is, not wait around for a world we wish to be.
We are calibrating our relationships, so their depth reflects our values, and we’re prioritizing broad engagement to maximize our influence, given and given the fluidity of the world at the moment, the risks that this poses and the stakes for what comes next.
And we are no longer just relying on the strength of our values, but also the value of our strength.
We are building that strength at home.
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Source: Davos Forum, Switzerland 2026
