Canada can work with United States President Donald Trump’s administration to reshape global trade and weaken China’s dominance of supply chains, according to Chrystia Freeland, the Canadian politician who’s vying to replace Justin Trudeau as prime minister.

Freeland said she believes Trump is very smart, has a clear world view, and is threatening to impose huge tariffs on Canada, Mexico and other allies in part to pave the way for tougher policies on China.

“He has come to the conclusion that if he can show the rest of the world how mean and tough he can be with his closest partners and allies — how much he’s prepared to beat up on those really nice Canadians, who throughout history have been great partners for the U.S. — how do you think that’s going to make the Chinese feel?” she said in an interview with Bloomberg News.

Freeland identified Scott Bessent, who won confirmation as Treasury secretary, as a potential ally that Canada can work with to help change the game on global trade. She called him “an incredibly sophisticated global economic thinker.”

“China over and over again promises and fails to have strong domestic demand,” Freeland said. “Canada can be a valuable and intelligent partner for the U.S. in the effort to rebalance the global economy.”

In her quest to take over from Trudeau as Liberal Party leader, Freeland is framing herself as a candidate with the backbone to stand up to the U.S. administration. She has boasted about Trump’s antipathy toward her, including his post on Truth Social in December that called her behaviour “totally toxic, and not at all conducive to making deals.”

During Trump’s first term, Freeland helped lead Canada’s negotiations on the North American free trade deal and gained a reputation for being stubborn and aggressive. Despite the contentious relationship, the talks concluded with an updated pact that was seen in Canada as a political win for Trudeau’s government.

Since returning to power in Washington, Trump has taken aim at the size of the U.S. trade deficit with Canada, which is largely driven by U.S. imports of oil, gas and other commodities. And he has further taunted Canadian politicians by suggesting on multiple occasions that the country should be a U.S. state — an idea that is opposed by 90 per cent of Canadians, according to one survey.

Freeland said a government led by her would hit the U.S. hard if Trump imposed tariffs. She has called for Canada to publish a list of US$200 billion worth of goods that Canada imports from the U.S. on which it would place counter-tariffs, if necessary, to apply pressure to the U.S. administration.

“I would say for President Trump, weakness is a provocation. I think capitulation is not a negotiating strategy with him,” Freeland said. Canada, she said, should not negotiate against itself.

“We have negative leverage. If you hit us, we — uniquely in the whole world — do have the economic capacity to hit back,” she said. “And we also have positive leverage. There is a lot that we can offer you guys. And I think, broadly, Americans know that.”

She has also proposed to host an international summit of countries targeted by Trump, including Mexico, Denmark, Panama and the European Union.

Freeland faces a tough battle for the party leadership against Mark Carney, the former governor of the Bank of Canada and the Bank of England. Carney has secured endorsements from much of Trudeau’s cabinet, including nearly all of the highest-profile ministers.

That’s a blow for Freeland, who served alongside those ministers for years. But she has argued it’s a sign that Carney is the choice of the “Ottawa establishment,” despite the fact he never served in Trudeau’s government or in any elected political office.

Asked about what makes her different from Carney, she cited her long political experience; she was first elected to Canada’s Parliament in 2013.

“It is one thing to be a technocrat, it is one thing to be a bureaucrat responsible only to your own bureaucracy and ultimately to your political masters,” she said. It is another thing to be an elected politician, responsible to your country and your citizens and to go mano a mano with the tough guys. That’s something I’ve done.”

Freeland has attempted to distance herself from Trudeau, starting with her stinging resignation letter as finance minister in mid-December that criticized the prime minister for being focused on “costly political gimmicks” instead of preparing for a trade war with Trump. Trudeau never recovered, and he called the leadership race three weeks later.

—With assistance from Kevin Orland, Christine Dobby, Sandra Mergulhao and Laura Dhillon Kane.

Bloomberg.com