Canada’s new PM Mark Carney reshapes cabinet to redefine U.S. ties

Canadian Prime Minister Mark Carney announced a streamlined cabinet focused on economic reform and redefining ties with the U.S., following his election win last month.

Canadian Prime Minister Mark Carney, elected last month on a platform of economic renewal and firmer diplomacy with the United States, introduced a restructured federal cabinet on Tuesday, aimed at setting a new direction for the country’s foreign and domestic priorities.

Carney reduced the number of ministers from 39 under former Prime Minister Justin Trudeau to 29, signalling a leaner and more focused approach to governance. While he retained several high-profile figures, including Finance Minister François-Philippe Champagne and U.S. Trade Minister Dominic LeBlanc, the cabinet saw notable changes.

Melanie Joly, who served four years as foreign minister, was moved to the industry portfolio. Her post was filled by Anita Anand, a respected figure with experience in defence and public procurement. Chrystia Freeland, whose resignation as finance minister last December contributed to Trudeau’s political downfall, retained a cabinet position as minister of transport and internal trade.

Tim Hodgson, a former Goldman Sachs banker, was appointed minister of natural resources, replacing Jonathan Wilkinson, who was removed from cabinet altogether.

“This focused team will act on this mandate for change with urgency and determination,” Carney’s office said in a statement. “Canadians elected this new government with a strong mandate to define a new economic and security relationship with the United States and to build a stronger economy.”

Carney has committed to a significant economic pivot, stating that Canada must reduce its reliance on the U.S. market by investing billions to diversify trade and modernise key industries. His immediate priorities include implementing a broad tax cut and eliminating interprovincial trade barriers by July 1.

However, his Liberal platform also includes new spending commitments totalling around C$130 billion over the next four years, with a projected budget deficit of C$62.3 billion for 2025–26. This is a marked increase from the C$42.2 billion forecast in the previous government’s December update.

The new cabinet is expected to play a central role in steering Canada through complex challenges, including strained cross-border relations, fiscal reform, and regional economic integration.

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