(March 15): Mark Carney has been sworn in as Canada’s 24th prime minister, bringing the former central banker to power in the middle of an explosive trade war with the US.

The 59-year-old took the oath as Canada’s new leader at a ceremony in Ottawa on Friday, five days after Liberal Party members voted overwhelmingly for him to replace Justin Trudeau as the head of the party.

In his first news conference as the prime minister, Carney told reporters there had been “progress” in discussions with US President Donald Trump’s administration, after weeks of hostilities that had resulted in each country placing tariffs on tens of billions of dollars of the other’s exports.  

“I respect what he is looking to accomplish,” Carney said of Trump. 

“We will both be looking out for our countries,” he added. “He knows and I know from long experience that we can find mutual solutions that win for both.”

Carney appointed a Cabinet that was smaller than Trudeau’s and will have a shorter lifespan, as an election is expected within weeks. He tapped Francois-Philippe Champagne to be his finance minister and moved Dominic LeBlanc to international trade, while keeping Melanie Joly as his foreign minister and David McGuinty as the public safety minister.

“Canada’s new government will be action-oriented, driven by a smaller but highly experienced team made to meet the moment we are in,” Carney said. “First, protecting Canadian workers and their families in the face of unjustified foreign trade actions. And second, growing this great country by putting more money in Canadians’ pockets.”

The ex-Goldman Sachs banker’s rise to the country’s top office is remarkable for a number of reasons. He is the first Canadian prime minister to get the job without ever having held a seat in the House of Commons or Senate, except for the country’s very first prime minister in 1867, who was appointed shortly before its first election. 

He also assumes the role at the most difficult moment in Canada-US relations in recent history. Trump has threatened to use “economic force” to try to turn Canada into a US state, and has already imposed steep tariffs on many Canadian goods, with Canada retaliating in kind. The escalating trade tensions between the countries have already hampered business and consumer spending plans. Additional tariffs expected next month have the potential to plunge Canada into a recession this year.

Carney told reporters he does not have plans to travel to the US, but looks forward to speaking with Trump at the “appropriate moment”. He said he met the US president during the latter’s first term in office at Group of Seven and Group of 20 meetings. 

Regarding Trump’s claims that Canada should join the US — for which Secretary of State Marco Rubio said on Friday the president had an economic argument — Carney said: “It’s crazy.”

“Before we get to the economics of it, we won’t be part of it. And when we get to the economics, and the president is a successful businessperson and dealmaker — we are his largest client in so many industries,” Carney added. 

“And clients expect respect, and working together in a proper commercial way. So the nature of Canada means we won’t, and the economics means we shouldn’t” even consider a union with the US, he said.

Carney has touted his credentials as someone who has led in uncertain times before. During his first year as the Bank of Canada governor, the global financial system was seized by a full-blown crisis. He slashed interest rates to almost zero. As the Bank of England governor, he also helped steer the UK economy during the turmoil of Brexit.

Despite a resume that spans two Group of Seven central banks and major investment firms, Carney is a political novice. He told reporters on Friday to expect news of an election “in the coming days”, so that he can seek a strong mandate for his government. 

His new Cabinet met on Friday afternoon. Cutting its size from 37 people to just 24, he moved Environment Minister Steven Guilbeault to a “Canadian culture and identity” portfolio, replaced Immigration Minister Marc Miller with Rachel Bendayan, and promoted Anita Anand to the industry minister. 

Carney’s rival in the Liberal leadership race, former finance minister Chrystia Freeland, will take over Anand’s previous role as the transport and internal trade minister. Jonathan Wilkinson will remain as the energy minister. 

Among his first actions as the prime minister, Carney scrapped the consumer carbon tax — Trudeau’s signature climate policy that became politically untenable as post-pandemic inflation soared. Conservative Leader Pierre Poilievre blamed the tax for making life less affordable.

An election will see Carney face off against Poilievre, a sharp career politician whose party has lost its huge lead in opinion polls in recent weeks. Carney may hope to ride a recent surge in support for the incumbent Liberals. 

Carney’s swearing-in ushers out the Trudeau era, which was marked by expansive social programmes that improved some measures of equality, but also saw economic growth lag the country’s peers on a per-capita basis. 

Poilievre took aim at Carney’s decision to keep many of Trudeau’s Cabinet ministers, accusing them of being the same politicians who “voted to hike the carbon tax, double the debt, double food bank line-ups and double housing costs”.

“Mark Carney thinks Canadians are stupid. He thinks that a little bit of cosmetic surgery will allow the Liberals to disguise who they are and make people forget what they did for 10 years,” Poilievre said at a news conference.

Carney plans to travel to France and the UK early next week, a signal that he believes his government needs to shore up relationships with major European countries that are also targets of Trump’s trade war. He is also preparing a phone call with Volodymyr Zelenskiy, the Ukrainian president’s office said. 

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