Carney unveils cabinet aimed at urgently resetting US-Canada ties

By Promit Mukherjee and David Ljunggren

Canadian Prime Minister Mark Carney, who won an election last month promising to stand up to U.S. President Donald Trump, unveiled a new cabinet on Tuesday that he said would help define a new relationship with Washington.

Carney cut the number of ministers to 29 from the 39 under former Prime Minister Justin Trudeau, but kept some key players in their positions, such as Finance Minister Francois-Philippe Champagne and Dominic LeBlanc, who is in charge of U.S. trade.

He moved Melanie Joly from Foreign Affairs to Industry after four years and replaced her with Anita Anand.

"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's office said in a statement. "... This focused team will act on this mandate for change with urgency and determination."

Carney met Trump in Washington last week but did not secure any removal of tariffs the president has imposed on Canadian exports.

Carney says Canada must spend billions to start shifting the economy's focus away from the United States as well as end barriers to internal trade and cut public spending.

"Right now, the business of government must be business ... (we are) eager to work with the new government and all parties to tackle urgent nation-building goals," said Matthew Holmes, policy chief at the Canadian Chamber of Commerce, calling for action on issues such as regulatory reform and trade diversification.

Chrystia Freeland, whose resignation as finance minister last December helped oust an increasingly unpopular Trudeau, keeps her job as minister of transport and internal trade.

Former Goldman Sachs banker Tim Hodgson takes over as natural resources minister, replacing Jonathan Wilkinson, who was dropped from cabinet.

As well as the cabinet ministers, Carney named 10 more junior secretaries of state.

His immediate promises are a tax cut and ending all trade barriers among the 10 provinces by July 1.

The Liberal platform, which promises additional spending of around C$130 billion ($92.85 billion) over the next four years, predicts that the 2025-26 deficit will be C$62.3 billion, far higher than the C$42.2 billion forecast in December.

Carney abolished the position of labor minister and replaced it with a secretary of state for labor, a move the Teamsters union called deeply confusing and concerning.

"It suggests the Carney government is underestimating the scale of the challenges facing Canadian workers in the years ahead," union spokesperson Christopher Monette said by email.

The Trudeau government had to deal with several major labor disputes and last year intervened to end separate strikes by port, railway and postal workers.