Crypto News: A distracted and divided Canada

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Justin Trudeau's planned resignation as prime minister puts Canada in a bind over its awkward southern neighbor.

President-elect Donald Trump is threatening to impose 25% duties on Canadian imports, and used Trudeau's announcement yesterday that he'll leave once a successor is chosen to again mock Canada as the 51st US state.

Not only will Trudeau be a lame-duck leader when Trump takes office this month, but he may lose key cabinet ministers as contenders jockey to replace him as Liberal Party chief.

Chrystia Freeland, who led Canada's trade negotiations during Trump's first term, already quit as finance minister last month. Her replacement, Dominic LeBlanc, is frequently cited as a leadership hopeful, as is Foreign Minister Melanie Joly.

But both are frontline ministers on US relations and if they run for leader, they will likely need to step down first.

Other candidates include Mark Carney, the former central bank governor and current chair of Bloomberg Inc., who said he's considering a leadership run.

Mark Carney. Photographer: Jeenah Moon/Bloomberg

Canada isn't alone in facing political turmoil as Trump assumes office. Among fellow Group of Seven nations, Germany is in campaign mode ahead of Feb. 23 elections, France is suffering political gridlock and UK Prime Minister Keir Starmer has had a rocky start. In Asia, meanwhile, South Korea's president is impeached and subject to arrest.

Canada's opposition parties are pledging to bring down the Liberal government at the next opportunity, which should come in late March. That would trigger an election, with Pierre Poilievre's Conservative Party far ahead in the polls.

Poilievre has been road-testing his approach to Trump, using blunt language to point out the US trade deficit is driven by "stupid" Canada selling its oil at a steep discount.

Canada, once considered a poster child for handling Trump, is consumed with strife just as the incoming president promises economically devastating tariffs.

Far from being unified against the threat, Canada is distracted and divided — and it may only get worse from here. — Brian Platt

Pierre Poilievre speaks during a news conference in Toronto in December. Photographer: Cole Burston/Bloomberg

Global Must Reads

Trump denied a Washington Port report that he may moderate plans for across-the-board tariffs once in office, fanning uncertainty about his trade policy concerning allies and foes alike. As this piece explains, that may have been the point.

Senior politicians from three of Britain's biggest parties have privately urged Trump's allies to reconsider his relationship with Elon Musk, after the billionaire Tesla boss made a series of increasingly inflammatory remarks about UK politics, including endorsing a figure on the far right. Starmer's Labour government, the Conservative opposition and Reform UK are all questioning whether the alliance between Musk and Trump can last, sources say.

North Korean leader Kim Jong Un said the nation's new hypersonic missile will keep any rivals in the Pacific region in check, following a test launch yesterday that coincided with US Secretary of State Antony Blinken's visit to Seoul. The weapon flew 1,500 kilometers (932 miles) at 12 times the speed of sound, according to the nation's official news agency.

Blinken talked up Washington's close economic and security partnership with Japan after a controversial move by President Joe Biden to label Japan's Nippon Steel as a national-security risk. The top US diplomat didn't address the decision in his remarks in Tokyo today and ignored reporters' questions about it, an indication of the rare point of tension between the close allies.

Blinken with his Japanese counterpart in Tokyo today. Photographer: David Mareuil/Pool/Getty Images

US Treasury Secretary Janet Yellen told China's vice premier she had "serious concern" regarding "malicious cyber activity" a week after the US said Chinese state-sponsored hackers had breached the Treasury Department's networks.

The Philippines has accused a giant Chinese coast guard vessel dubbed the "Monster" of maintaining an "illegal presence" in its exclusive economic zone as Beijing ramps up activities in the disputed South China Sea.

Namibia is seeking investment from China in nuclear power as one of the world's largest uranium producers looks to boost its role in the global push toward clean energy.

Donald Trump Jr. will travel to Greenland today in a surprise visit to the Arctic territory, just weeks after his father rekindled the idea of buying the island from Denmark despite it not being for sale.

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Chart of the Day

CATL ranks among the biggest Chinese firms to ever be blacklisted by the Pentagon, with about one in three electric cars using its batteries. Its extensive presence across supply chains has the potential to severely upset the industry should automakers have to find an alternative. While the blacklisting only impacts each company's ability to supply the US military, there's the tough to quantify — and more problematic — reputational hit.

And Finally

The leaders of Malaysia and Singapore formalized an agreement establishing a special economic zone linking their two nations' border region, with the aim of attracting 50 projects in the first five years. Officials have previously said they expect the zone to create as many as 100,000 new jobs and add $26 billion per year to the Malaysian economy by 2030. Much of that would likely come from new investment and Singapore-based firms expanding or shifting production.