Senator Yuen Pau Woo

Good morning.

The idea of “middle powers” playing a unique role in global affairs is not new. Countries that self-identify as middle powers have long imagined having an outsized influence in the world, stepping in as a collective to solve regional or global problems that great powers are unable or unwilling to address.

It is doubtful if middle power coalitions have ever been successful much beyond mutual self-help, awareness raising and a modest restraint of great powers. From the attempt to codify the “Responsibility to Protect” (R2P) in situations of mass atrocities to the Cairns group in the WTO, and in the establishment of the International Criminal Court, these efforts have generally been successful for only as long as the issues at stake have not tested the core interests of the great powers.

R2P, which emerged as a sincere response to the 1994 genocide in Rwanda, has been largely ineffective in subsequent cases of civil unrest in Syria, Myanmar, South Sudan, the Democratic Republic of Congo, and Gaza. NATO’s military intervention in Libya in 2011 invoked R2P, but this action was aligned with the interests of the United States. The Cairns group has won the intellectual argument for agricultural sector liberalization, but tariff and non-tariff barriers in agriculture and agrifood are as entrenched as they have ever been. And while the ICC was successful in prosecuting six individuals for grave violations of international law (i.e. war crimes and crimes against humanity), all the individuals prosecuted to date are Africans who were involved in conflicts that the US did not have a serious stake in. Today, all 9 justices on the ICC have been sanctioned by the US because of the Court’s arrest warrants for Israel’s Prime Minister and former Defence Minister.

The shortcomings of middle power initiative were evident during a period of expanding globalization under US pre-eminence – a period that should have been the most conducive to middle power initiative. In the current context of heightened geopolitical competition and national self-interest, the prospects for middle power initiatives would seem to be even less promising. As the undisputed global hegemon, the United States was willing to exercise a benign neglect of middle power groupings acting against its interests. As a declining power, the US is less likely to indulge initiatives that poke the eagle. This is likely true regardless of the person in charge of the White House.

Which brings us to the famous “rupture” speech that Prime Minister Mark Carney delivered at Davos in January of this year. I agree with him that there has been a rupture in the world order, and while he doesn’t say as much, I think he would agree with me that the rupture is in part due to the relative decline of US power in a more multipolar world.

The importance of his observation about the double standards of the dominant powers is not in its insight, but it is in the fact that a G7 leader said it. For most observers of international economics and politics from the Global South, the uneven and inconsistent application of the international order has been obvious for as long as the post war international order has been in place.

While Mr. Carney has acknowledged the stirrings of a new world order that resists the double standards of the status quo, his proposed solution seems to cling to significant chunks of the old order without any suggestion of how the old order powers (of which Canada is a part) intend to redress the inequities of that order. He has offered an a la carte menu of policy directions that can “take the world as it is, rather than as we wish it to be”, while exercising “values-based realism” and seemingly “applying the same standards to allies and rivals” when it comes to economic intimidation. All of which is captured in the magnificently elastic term “variable geometry,” which appears to be the closest thing we have to a Carney foreign policy doctrine.

According to PM Carney, a primary vehicle for implementing variable geometry is middle power agency. What does that mean?

Here we need to distinguish between several distinct ideas that tend to be conflated and applied uniformly to middle powers. Let me propose a simple framework for understanding four different approaches that middle powers such as Canada are pursuing.

The first is autonomous strategies of middle powers that are essentially defensive actions to strengthen economic resilience and create strategic autonomy. They include industrial policy; domestic procurement and sourcing; sovereignty enhancing measures, for example in digital technologies, orbital space, food and other critical inputs; investing in military capability; trade protection in selected areas; and infrastructure development for a stronger domestic economy. You will recognize all of these as priority items of the Carney government. The underlying logic is greater self-reliance and reduced vulnerability to external shocks, all of which makes intuitive sense. But we should be clear that autonomous strategies do not necessarily involve coalitions of middle powers, and they can in some cases create conflicts among middle powers. They also have nothing to do with strengthening the international system, providing global public goods, or redressing the inequities of the status quo order.

A second strategy is mutual assistance, which is a more explicit form of middle power cooperation that seeks to build or protect privileged relationships among middle powers from disruption due to global events, including economic coercion, war, pandemics, and other shocks. Currency swap agreements, supply chain continuity deals (e.g. buyer’s clubs for critical minerals or semiconductors), non-market sale/purchase agreements, and defense cooperation are examples of mutual assistance that are essentially a form of bilateral or plurilateral self-help. These deals are akin to preferential trade agreements (PTAs) that benefit the members but do little for the international system and, like PTAs, can in fact harm the multilateral trading system.

The third form of “middle power” strategy is hedging. It is the most well-known and most often cited prescription for middle powers that fear domination by great powers. In Canada, it has found fresh expression in the old idea of “trade diversification.” In military-strategic terms, hedging is sometimes described as “balancing.” Hedging or balancing, however, is not a middle power strategy as much as it is a strategy to reduce overdependence on a single market for economic growth or on a single country for military and diplomatic support. No sensible hedger would eschew the US or the Chinese market in favour of increased trade solely with other middle powers. Hedging is simply portfolio diversification applied to international trade and diplomacy. A hedging strategy might overweight or underweight major markets, but it is unlikely that the strategy would exclude those markets altogether.

Middle power coalitions to solve global or regional problems, on the other hand, are in a category all to itself. I have already provided some examples of middle power coalitions to solve regional or global problems that were limited in their success — even during a permissive period of benign globalization. I am even less optimistic about the prospects of success in an era of heightened geopolitical competition, nationalism, and multipolarity.  

Part of my skepticism stems from the way in which these kinds of coalitions tend to be imagined. They are usually coalitions of middle powers that largely represent the status quo order and are fundamentally seeking to resurrect a version of the old order that preserves the privileges and power of the West. An exemplar of this approach is the recent proposal from Anders Fogh Rasmussen, former Prime Minister of Denmark, ex-Secretary General of NATO, and current head of the Alliance of Democracies. He has proposed the establishment of a new organization which he dubs the Democracies-7 (D7), consisting of Australia, Canada, the European Union, Japan, New Zealand, South Korea and the United Kingdom as founding members.

The D7 proposal is premised on the idea that a self-selected group of model middle power democracies have a unique responsibility to solve global problems defined by the group. This is the kind of middle power coalition that not only risks reinforcing perceptions of Western moral superiority but is also oblivious to the very reasons for a rupture in the international system.  

To quote Finnish President Alexander Stubb (from whom Carney cribbed the idea of “values-based realism”): “The Global South will decide whether geopolitics in the next era leans toward cooperation, fragmentation, or domination. . . . This is the last chance for Western countries to convince the rest of the world that they are capable of dialogue rather than monologue.”

We can already see the four strategies I have described playing out around us. Autonomous strategies are evident in the race for semiconductor independence and sovereign AI. Mutual assistance is visible in the rise of friendshoring and politically aligned supply chains. Hedging is what firms themselves are doing through diversification — ‘China plus one’ strategies that reduce exposure without abandoning major markets. And when we turn to global problems — digital governance or modern warfare — what we see so far is not the success of middle power coalitions, but their absence, reflected in the fragmentation of the internet and the compartmentalization of conflict. The world is differentiating along precisely the lines of these four strategies.

I am not entirely giving up on the idea of middle power coalitions to solve global problems, but on this question, the key issue is whether the coalitions are consonant with the emerging world order or if they are efforts to shore up the status quo. It is not a question about “who is a middle power” since there are middle powers with capability but who do not self-identify as middle powers, and there are middle powers that have no capability on the issues that matter. What is important, rather, is how we qualify the idea of a suitable “middle power.” The standard formulation is that we — that is Canada — will work with “like minded” middle powers, or middle powers with “shared values.” This is a rhetorical reflex of western politicians and diplomats that is increasingly empty and platitudinous, and therefore harmful to the “variable geometry” we seek to pursue. Is like mindedness and common values only about individual freedoms and liberal democracy? What about the common values of economic and social welfare, technological progress, cultural protection, and public safety? 

The existing international order is under strain, and a new order is taking shape. Middle powers must decide whether their collective action is aimed at extending the life of status quo institutions or positioning themselves constructively within an emerging global landscape shaped by shifting power, new actors, and new forms of cooperation. Limiting our scope of action with legacy ideas about common values and like mindedness not only exacerbates the problem of hypocrisy that the Prime Minister exposed in Davos but also constrains Canada’s ability to exercise variable geometry for new ideas, new opportunities, and new partners. 

And with that, I invite all of us to ponder the question of middle power prospects after the rupture and look forward to the panels to follow.