McLeod Group guest blog by W. Andy Knight, April 15, 2026
Canada’s foreign policy is entering a very uncertain strategic terrain.
For decades, Canadian diplomacy operated within a relatively stable geopolitical architecture: a liberal international order anchored by the United States and reinforced through institutions such as NATO, the United Nations, and the Bretton Woods system. Within that framework, Canada cultivated a reputation as a constructive middle power, supporting multilateral cooperation, peacekeeping, development assistance and rules-based governance.
That world is fading.
The current moment is better understood through Antonio Gramsci’s concept of an interregnum: a period in which the old order is dying while a new one struggles to be born. The United States remains the world’s most powerful state, but its willingness and capacity to sustain the international system it once championed have clearly diminished. At the same time, rival powers such as China and Russia challenge elements of that order, while emerging powers across the Global South question Western dominance within global institutions. As India’s Prime Minister Narendra Modi noted at the 2025 BRICS Summit, two thirds of humanity from the Global South remain underrepresented in twentieth-century global institutions, calling for urgent reforms to the UN Security Council, the World Trade Organization and multilateral development banks.
For Canada, the implications are profound. Many of the assumptions that shaped Canadian foreign policy since the end of the Second World War can no longer be taken for granted. Chief among them is the assumption that the United States will consistently serve as a stabilizing force within the international order, an assumption that was always more aspiration than certainty.
Prime Minister Mark Carney’s Davos speech in January 2026 calling for a foreign policy grounded in value-based realism, a term borrowed from Finnish President Alexander Stubb, signals that Canada’s leadership recognizes the need to adapt to a rapidly shifting geopolitical environment. But navigating the interregnum requires more than recalibrating the balance between values and realism. It requires a deeper reassessment of the role Canada seeks to play in a world where the foundations of global order are under strain.
The Limits of Comfortable Multilateralism
Canada’s diplomatic identity has long been built around multilateralism. From Lester B. Pearson’s role in creating UN peacekeeping to Canada’s leadership in the Ottawa Treaty banning anti-personnel landmines and its advocacy for the Responsibility to Protect doctrine, Canada has often presented itself as a principled middle power committed to cooperative global governance.
Yet the effectiveness of this approach depended heavily on a functioning liberal international order underwritten by US leadership.
Even at its height, however, the so-called rules-based order was never as universal or impartial as it was often portrayed. As Prime Minister Carney acknowledged at Davos, many countries understood that the system contained contradictions: the strongest states often exempted themselves from rules when convenient, trade regimes were enforced asymmetrically, and international law was applied with varying degrees of rigour depending on the identity of the accused or the victim.
For many states in the Global South, these inconsistencies were not new discoveries but longstanding realities. The legitimacy of the liberal order therefore rested as much on its practical benefits as on its normative claims.
Today, that system is fraying. The paralysis of the UN Security Council, the weakening of arms control regimes, the resurgence of geopolitical bloc politics, and growing skepticism toward global institutions all signal that the old framework is no longer operating as it once did.
At the same time, the United States itself has become a less predictable partner. Protectionist trade policies, shifting security commitments and the politicization of alliances have forced Canada to hedge against uncertainty from its closest ally.
In such an environment, Canada cannot simply rely on inherited diplomatic habits. It must think more carefully about how to exercise influence when the global system itself is in flux.
Rediscovering Strategic Middle-Power Leadership
One path forward lies in revitalizing the concept of middle-power diplomacy but adapting it to the realities of the interregnum.
Rather than assuming the stability of the rules-based order, Canada should focus on helping stabilize and renew key elements of global governance alongside a wider group of partners.
This requires three shifts in approach.
First, Canada must build coalitions beyond traditional alliances.
Canada’s closest partnerships, within NATO, the G7 and the Five Eyes intelligence community, still matter. But the geopolitical terrain now demands broader coalition-building that includes emerging and regional powers.
Countries such as Brazil, India, Indonesia, South Africa and Nigeria carry growing weight in shaping global norms and institutions. Many of these states do not neatly align with Western geopolitical agendas, yet they are indispensable partners for addressing global challenges from climate change to global health and peacebuilding. The expansion of BRICS to include countries such as Indonesia, Egypt, and Ethiopia underscores the growing institutional weight of these coalitions.
Canada should therefore invest more deeply in issue-based coalitions that bring together diverse states around shared interests rather than rigid geopolitical alignments.
Second, Canada must rebuild its engagement with the Global South.
Canada’s foreign policy credibility historically rested in part on its reputation as a bridge between North and South. In recent years, however, reductions in development assistance and a growing emphasis on commercial diplomacy have weakened that role. The 2025 federal budget’s $2.7 billion cut to international development assistance over four years, despite the Prime Minister’s pre-election pledge not to reduce foreign aid, has further eroded Canada’s standing.
If Canada wishes to remain influential in global governance, it must rebuild trust with partners across Africa, the Caribbean, Latin America and Southeast Asia. Development cooperation, climate finance and institutional partnerships remain vital tools of diplomacy. They are not simply acts of generosity but investments in a stable international system.
Conversations with policymakers and scholars in the Caribbean, for example, reveal deep concern among small states about being caught in the crossfire of intensifying great-power competition. As one recent analysis noted, CARICOM countries face the challenge of navigating a world where external pressure is intensifying, and small states must develop collective strategies for survival. Canada has an opportunity to work with such states to strengthen regional solidarity and reinforce multilateral cooperation in a volatile geopolitical environment.
Third, Canada must defend democratic norms and human rights with greater care.
Canada has long framed its foreign policy around the promotion of democracy and human rights. These commitments remain important. But in a period of geopolitical fragmentation, defending democratic norms and human rights will require greater emphasis on institution-building rather than rhetorical positioning.
Supporting electoral integrity, strengthening civil society networks and reinforcing independent media across regions where democratic governance is under pressure can help sustain democratic resilience without feeding perceptions that Western states are imposing ideological agendas. As International IDEA has observed, championing democratic values effectively often means focusing on their concrete benefits rather than abstract formulations.
A Moment of Choice
The central challenge for Canadian foreign policy today is not simply balancing values and realism. It is recognizing that the global system itself is being remade.
In an interregnum, uncertainty is inevitable. But periods of systemic transition also create space for middle powers to shape the contours of the emerging order.
Canada’s comparative advantages remain significant: diplomatic credibility, strong institutions, development expertise and a long tradition of multilateral engagement. The question is whether Canada is prepared to deploy these assets with purpose in a far less predictable international environment.
Doing so requires moving beyond nostalgia for a fading liberal order and embracing a more adaptive form of international leadership. As Carney himself argued at Davos, Canada must take on the world as it is, not wait for the world as it wishes it to be.
If Canada succeeds, it can help ensure that the next global order, whenever it emerges, remains rooted in cooperation, justice and shared security.
If it fails, Canada risks becoming merely a policy taker in a world shaped by great-power rivalry.
The interregnum will not last forever. But the choices Canada makes now will help determine whether it helps shape the world that comes next, or simply adapts to it.
W. Andy Knight is a Distinguished Professor of International Relations at the University of Alberta. His research focuses on global governance, multilateral diplomacy and the evolving role of middle powers in the international system. Image generated by AI.