At Issue - What Carney’s G7 invite list says about his priorities

Episode Date: June 13, 2025

At Issue this week: Minister Mark Carney invites Indian Prime Minister Narendra Modi and Saudi Crown Prince Mohammed bin Salman to the G7 summit. Canada gets a defence spending boost. And how close are we to a trade deal with the U.S.? Rosemary Barton hosts Chantal Hébert, Andrew Coyne and Althia Raj.

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Hey, I'm Rosemary Barton. This week on At Issue, the podcast edition for Thursday, June 12th. Canada is hosting global leaders for a global conversation about numerous issues, energy security, peace and stability. What's been made of the expanded list of invites? What can we expect coming out of the G7 this week? Plus Canada strengthens its commitments to defense spending. So what's been made of some of the expanded list of invites to this meeting? What can we expect to come out of the G7 this week?

I'm Rosemary Barton. Here to break it down tonight, Chantelle Iber, Andrew Coyne, Althea Raj. Let's start with the invite list and then we'll get to whether we should expect anything substantive and remarkable. It has been expanded not only to, I think most controversially, invite Narendra Modi, but there was an invite to Saudi Arabia. And the list of people is longer than you might expect for a G7, not for the G7, but for the second day, where other nations will take to the table.

What did you make of what's behind this, Andrew, and why the prime minister has taken this approach? Yeah, I mean, it's almost like a G20 minus Russia and China, you know. I think they're sort of designing the plane while they're flying it. They're having to, you know, I think they're wrestling with a lot of issues that have been set in train by the calamity in Washington, if I can call it that, of Donald Trump, while Donald Trump is actually at the conference. It's going to be fascinating to see them try to square that circle.

I think it accounts for the fact that they're not going to be issuing a communique at the conference. It's going to be fascinating to see them try to square that circle. I think it accounts for the fact that they're not going to be issuing a communique at the end. But they're trying to deal with, for example, Ukraine and the very changed security situation. Well, the situation has changed because the United States has basically taken Russia's side. So I think perhaps part of the calculation was there was safety in numbers. If you bring in more players, you can make it more of a kind of a global if you will of the democracies rather than just the G7. But they're taking on a lot of things at the same time but because a lot of things are

happening at the same time. Yeah, but a lot, but I mean those invites didn't have to go out, Althea. This is obviously, the Prime Minister's made this decision in terms of what he sees is happening in the world and what his goals are. So tell me your thoughts. I think one, it's how Mark Carney wants to present himself to Canadians and to the world. Two, it's a focus on trading relationships. Three, it's a recognition that the global geopolitical situation has changed, that our so-called enemies

have bandied together and that we need to do a better job of integrating our friendlies in a way of not just being a kind of elitist club. So I think that there's a lot of numerous, there are there's probably more considerations than that, but that have influenced some of the invite list. I'm told the Saudi Arabia invite, which I thought was deeply shocking, that MBS had been invited, but apparently he's not coming,

has more to do with Palestine and the situation in Gaza and recognition of Palestine territory than it has anything to do with business trade. I put that out there, that's what I've been told. I think the fact that we're bringing the Mexico president here is a good sign to reset the relationship, which seems to be frosty, especially since Doug Ford,

the premier of Ontario has suggested we should phrase out Mexico from a renewed Kuzma deal or a negotiator side agreement. So I think there's a whole bunch of different agendas at play at this Sunday, Monday, Tuesday meeting. The Prime Minister did tell Petit-Srois yesterday that the UAE and Saudi Arabia, that that was also about artificial intelligence and tapping into capital there, you know, for what it's worth. Chantal, what do you make of the invite list? It's not the first time, and not just the Canadian thing, that the G7 list is extended. We always knew President Zelensky, for instance, was going to show up.

He was invited from the first. And once Donald Trump said he would be there, he's a major draw. It's easy to invite people. They're basically coming not to sign off on communiques but to talk to Donald Trump one-on-one if they can grab his attention long enough. If you go back to the beginning, the notion of the G7 in this current environment, the elements of that meeting, adds Zelensky to that, was maybe the elements of a six versus one dynamic, i.e. all the others versus Donald Trump plus Zelensky.

And up to a point, you kind of take away from that possibility by drowning the place with issues and meetings. It is also, I believe, useful for people who run countries to talk to each other one on one. Things that you will not see in the community do get accomplished over that. But I think by doing that, Mark Carney has saved himself the scenario of everyone ganging up on Donald Trump with the expected results. As for trade, well, we'll see. I'm not so sure that we're going to get a lot of practical results from these meetings.

We'll talk later about whether anything could happen there between Canada and the U.S. But you mentioned it too, Andrew. There's no final communique that was told by a senior Canadian official today. There are going to be short statements of agreement potentially. Does that kind of thing matter or does it just matter that they're all there talking about things? I think it reflects reality. You know, there isn't a G7 as such anymore.

When the biggest player, as big as all the rest of them, is basically on the other side of a number of fundamental issues, then you're kind of going through the motions in a way by continuing to meet as a G7. So I think the only answer to that was to enlarge it, to give more free play for some of these negotiations and discussions on the sidelines, to not try to pretend there's a unity when there isn't unity, but to try at the same time to get some of these, the other non-U.S. actors to give them a chance to work together and to pretend the U.S. is sort of both there and not there at the same time.

I cannot imagine how weird it is for anybody in these negotiations to be having to pretend the United States is still on board when it manifestly isn't. And yet that's what they're going to do. Yeah. It'll be even stranger than like Trump 1.0, I would think, Althea, in terms of how much further he's gone in some of his positions. The thing is, all the negotiations for what would be in a communique have basically already happened.

So they know what the points of tensions are. And in a way, this is lowering expectations so that we don't expect that there is unanimity on a final statement. And if by a miracle there is no drama and actually they get agreement, everybody will say what a great success this was. So that's part of it. The other thing is they probably didn't think that they could get agreement. But I think I just, I want to mention on the earlier point,

because I think it reflects the way this government is running things. You know, this Modi backlash that is happening within the liberal caucus, if they had discussed this issue ahead of time with the caucus, they would have been able to mitigate so much of the backlash that has happened. The same thing with C5, the Natural Resources Bill. If they had talked to caucus about it before and not briefed

them an hour before they tabled it, some of the backlash would not have happened. Or the stakeholders on the border bill. They don't seem to value caucus as a sounding board and I think this is going to cause more and more problems if they don't realize it soon. Well, yeah, we've seen that certainly with past Prime Ministers. Chantelle, last word to you on this. Well, on the Modi invite, you can understand why liberal caucus members would be jarred. It's not even a year since Justin Trudeau stood up in the House of Commons to say there

was evidence that the Modi government had partaken in the assassination of a Canadian citizen on Canadian soil. So it seems for many caucus members that this, I mean this is a Prime Minister who is getting rid of red lines from his predecessors, but this was one that really stuck because it was totally unexpected and here is right and not seeing it coming kind of makes it worse because you do need the explanations and they came after them. Okay let's leave that part of the conversation there thank you all when we come back we'll take a look at Canada's new commitment to defence spending. So what does this mean, these promises, these big commitments mean for the country, for

the military, for Canada's position on the global stage? That's next. Canada will achieve NATO's 2% of GDP target this year, half a decade ahead of schedule. In parallel, we are actively seeking to strengthen transatlantic security, particularly by becoming a participant in Rearm Europe. So here to break down what this new commitment means for our international partners and for the military, Chantal Hebert, Andrew Coyne, Althea Raj. Chantal, let's start with you.

This is a big amount of money, $9 billion, just over $9 billion, in a very tight timeline, and something that the world had been asking of us for some time, just as potential new targets are on the horizon. What does that tell you about the government's approach to the world? I guess Mark Carney's foreign policy approach, too.

It's kind of the same conversation almost. Okay, so I'm gonna bring it down to bargaining chip. Looking out to the G7 and the meeting with Donald Trump. One, two, a move that was not forecast in the election campaign, not part of the election platform that was put forward by the liberals. And three, a move that kind of makes the production of a budget a more compelling exercise than

maybe it even was a week ago, because I'm sure many people, including the opposition parties would really like to know what the tradeoffs for Canadians are going to be to pay for this. And finally, it's one thing to say that you're doing this, and some of this is the easy part, you raise wages, etc. But we have not been good at spending money and executing spending on the I'm being polite here. So where or how do we assume that we will be better at it by March 31st of 2026? Yeah, some new agency I think would be the government's answer, but how it works. Oh great. Yeah, I don't know either.

I don't know either. And I would also say, Andrew, part of what the Prime Minister said about what Chantel said about where this money comes from, he talked about Canadians making sacrifices without saying anything more about what that means either so anyway your thoughts? Except that he ruled out increased taxes so it's going to be either cutting spending in some area or more likely larger deficits which he doesn't seem to show much aversion to look it's progress that we're meeting the 2% target that we first agreed to informally in 2006 and formally in 2014.

It's a good thing he did it before the NATO meeting later this month because I'm not sure they'd let him in the door if he hadn't. And the target now, it looks like it's going to shift to 3.5% or 5% depending on how you define it. So we've got a lot of tough sledding ahead of time. I think he was right to focus in the short term on operational things like, as Chantel said, more recruitment, higher pay, things you can do

just by basically writing checks. You can do that quickly, and it's also really necessary. Part of our problem is not just lack of capacity, it's that the capacity we have now is not functional. We've got machinery that's broken down and we can't afford to fix it, et cetera. So good in the short term to focus on upgrading our existing capacity. Longer term we do have to figure out our broken procurement process if we're going to make capital acquisitions and so it's a little

distressing to see him emphasizing a made in Canada strategy where they're even going to have to use Canadian steel and Canadian aluminum. If we're going to meet our targets in a functional way, not just in terms of quickness, but also performance and adding the most bang for the buck, we should be buying the cheapest equipment wherever we can find it that can produce the machinery and the firepower that we need. And if that means buying it off the shelf from some other country, so be it. Part of the reason we're in the fix we're in in defense is we've used it over the decades

as a regional development or a pork barrel or an industrial strategy or a handout to the defense industry, whatever you wanna call it, but we've had everything except military readiness as our first priority. Yeah, except it's clear from what he said that he also is looking for ways to not spend most of the money in the United States.

In the United States, I understand that. He's trying to do those two things at once, I guess. I understand not being dependent on the United States, but we could be buying it from Italy, France, Sweden. Fair enough. Yeah, okay, Althea. So I agree with everything Andrew and Chantat have just said. I think the reason, plain and simple, that it wasn't in the election platform is because there's no way the math could have at all

worked. Five percent of military spending, and this is five percent of GDP, so it's not a number. You can grow the economy and make this less a significant spend, is almost a third of all government spending. And there's some of that spending you can't touch. It's transfers to healthcare, it's transfers to people, it's old age security. You can't touch this stuff. So the idea that they could cut this much out of the federal government is quite surprising

and will be felt if that's the way they're going, or they're just gonna add more to the deficit and the debt. And this will be structural deficits that I'm sure Andrew will write lots about. One thing I want to say on the procurement side, yes, there's trouble spending that money, but part of the vision, and I sat down with David McGinty, the new National Defense Minister this week, is it's about a new economic plan. They want to grow the Canadian defense industry. That's why they're joining Rearm. They want to help Canadian firms

negotiate for deals in Europe. They view the economy the way that we're gonna get the strongest economy in the G7 as natural resources, as critical minerals, and as the defense industry. And so it's as much about that than it is about responding to the threats of China and Russia in the defense industry. And so it's as much about that than it is about responding to the threats of China and Russia in the high archer. Which is exactly my complaint. Yeah, yeah. Go ahead Chantel. I can't see him doing what I'm imagining that he's not smiling. No he's not. I can confirm. Now he is, but go ahead Chantel. It's not the first government that wants to use defense, as Andrew pointed out, as a way to grow the economy.

But at some point, I mean all these goals seem to be on a collision course. And I'm curious to see how it's going to play out. This is just the first act, it's the easy first act. We'll see what happens down the road because once you get to the end of the fiscal year and a budget in between, there will be things that will need to be done to keep up that 2%, 3.5%. I think Mark Carney was playing defense with the announcement up to a point when he said, I'm not going to be told by a NATO accountants how much I'm going to spend. I don't think we'll ever sign off on 5%. It's not totally 5%.

It's 3.5% of pure defense spending and then 1.5% of security related. So that could be infrastructure, for example. That's not going to be a problem to get to. It's the 3.5% of ongoing defense spending and making sure that money gets out the door. Because to Chateau's point, we've had a lot of troubles making sure that happens. Yeah, go ahead, Chateau.

By the way, unless you assume that Justin Trudeau was a pacifist, there is a reason why they had set a much more distant target for this spending. Except, again, the Prime Minister seems to be suggesting, Andrew, that Canadians are prepared to do this, and public opinion polling shows that there is an openness to it. I got like 20 seconds. Yeah, well, the public opinion has wrapped itself around the idea of 2% of GDP. When the rubber hits the road of what are you going to give up to spend for that, that's

going to be interesting to see where the public opinion holds. Yeah, you're quite right. That was a good conversation. Thank you. We have to take a short break here. When we come back, we'll discuss the potentials, broad strokes of a deal between Canada and the U.S. That's next. I might go up with that tariff in the not too distant future. The higher you go, the more likely it is they build a plant here. So here to break down what progress could happen out of the G7 meeting, Chantal, Andrew and Althea.

I think we would all agree that no one has any idea if there can be a deal coming out of the G7 because Donald Trump is so unpredictable. But I wonder, maybe I'll start with you, Andrew, whether you think there is pressure on the Prime Minister to get a deal soon, in spite of the fact that he keeps saying we have time, we can wait, we've got time. I don't know whether he has pressure personally and politically to get this done.

I'm not sure, because what is the upside of getting a deal, frankly? We have no assurance of anything. We don't know with Donald Trump whether a promise, even if he were to make a promise to reduce the tariffs, which to my knowledge he hasn't yet, whether that stays in place, or whether he simply comes back and asks for more again.

So I think there's so much skepticism around the usefulness of any deal that I'm not sure that there's a huge amount of pressure on him other than the Fact that he said he's gonna try and get one But but you know the Trump has been in the habit of announcing deals that aren't really deals They're just agreements to keep talking etc. So it shouldn't be beyond the ingenuity of either party to come up with some similarly Vaporous agreement that can allow them to keep talking and allow them to save face.

I don't know if a vaporous agreement would be acceptable to Canadians though, Chantal. And they are going to have a bilateral at this G7. They are going to have some sort of conversation. I would imagine tariffs will be part of it. Well, if you take the Prime Minister at this word, in an interview that he gave yesterday to Canada. He drew a line in the sand. He said the first Canadian condition is tariffs disappear. They go off, not tariffs are reduced. So that's his own line in the sand. I don't know if he can get a deal based on that line in the sand. He wants a return to Kusma rules, which is in theory where we should be.

But it will be very hard to paper over differences and have a vaporous deal and jive that with what Mark Carney said yesterday in that interview. Yeah, Althea? The president has said that he wants a bunch of deals done by July 4th, so we are incentivized to just drag the puck as long as we want to get what we want because he seems to be the one that has the time crunch. I agree with Andrew and I think Shaltal on the like I don't know what the value of a deal is if the president continues to break his word even on the deal that he has signed. So I'm more concerned about

the things that we seem willing to be willing to trade or give to the Americans. There was reporting in The Economist for example that Canada is willing to give the Americans right of first refusal on critical minerals. There are questions to be raised about you big, beautiful bill, as the president calls it in the United States, that says it's a budget bill, but has language around AI saying that you can't regulate AI for 10 years. I hope we don't have anything that resembles that in a trade deal. So I think that there will be a lot of people interested to know

what we are willing to align ourselves with, especially if we just had an election campaign suggesting that we wanted to be quite different than our American friends. I'm told that critical minerals thing is not on, that that is not on the table, that that is not real, but for what it's worth. But we don't know, to your point, we don't know. We don't know what's really on the table. Chantel, last word to you there. Well, just to paraphrase a bit what Althea was saying, I don't think Canadians want to buy a deal

that actually make us an economic satellite or a military satellite of the United States. Yeah. And from everything I hear, I do believe that Mark Carney understands that. Quick last word to you, Andrew. I'm just gonna say that he's got all of the Liva in the world because Trump is now down to 38% in the polls and he's plummeting. So I think there's percentages is in stalling for time,

playing along. I don't think you have to sign a deal for all the reasons we were saying. I don't think Canadians are busting a gut that we have to sign a deal right now with the Americans because why would we? Okay, well we'll see what happens next week. Thank you all. I appreciate all those conversations and smart thoughts. That's at issue for this week.

What do you think about those expanded invites to the G7 Summit? What do you think about the increase to defense spending? Is it the right time to do it? You can let us know. You can send us an email at ask at cbc.ca. Remember, you can catch me on my show, Rosemary Barton Live, Sundays at 10 a.m. Eastern,

back in your podcast feeds next week. Thanks for listening. For more CBC podcasts, go to cbc.ca slash podcasts.