Source: Radio New Zealand
US President Donald Trump at the World Economic Forum (WEF) annual meeting in Davos on January 22, 2026. AFP MANDEL NGAN
There’s a rupture in the international rules-based order, but that doesn’t mean New Zealand will be crushed by bigger powers
New Zealand has been a beneficiary of the international rules-based order for decades – trade disputes, action on serious issues, being heard on the world stage; there was a world body to give us a hand sorting stuff out.
While there have been inconsistencies, hypocrisy from superpowers, and the system hasn’t been perfect, it has, generally, worked for us.
But Russia and America between them have shaken up the system, and in a remarkable speech at the World Economic Forum in Davos, Canadian Prime Minister Mark Carney laid it all out.
“I thought this might be the most important political speech on geo-politics for many a long year,” says Tim Groser, a former diplomat; once New Zealand’s chief trade negotiator; ambassador, including to the United States and the World Trade Organisation; and a National government Minister of Trade.
He says the key message of the speech was to acknowledge the reality that we are seeing a rupture of the rules-based system.
“It’s not just the United States. It is also the invasion back in 2014 of Crimea by Russia, to break the most important norm of the post-war order in Europe, which is, do not try and change sovereign frontiers with force.
“This has been the most important issue facing Europe now for at least 500 years, and was the cause of three wars … the Franco-Prussian war, and the two world wars.
“So it’s not just the United States. The order that we lived in from 1945 to, I think around 2010, was quite remarkable in so many respects, and almost perfect for a small country like New Zealand.”
Mark Carney’s speech spelt out how the ‘middle powers’ such as Canada, Japan and Australia need to act together, “because if we’re not at the table, we’re on the menu”.
New Zealand is not a middle power, but not helpless either, says Groser.
“Some New Zealanders vastly exaggerate our influence. They seem to think that the whole eyes of the world are watching every move that we make and if we only do the right thing everyone else will think ‘oh my goodness me, we must do what the Kiwis are doing’. This is a fantasy.
“But the more common fantasy is to understate our significance.
“Of course we are a small country. But in terms of GDP measured in conventional terms, we’re the 52nd largest economy in the world in relative terms. Which means since there are over 200 sovereign countries in the world, there are 150 countries smaller than New Zealand.”
New Zealand has also had historic developments to help us cope with these world changes, when in the 1950s Britain joined the European union and our main trading partnership evaporated. It forced us to diversify our markets. Groser says Canada needs to do the same now.
Canadian journalist Jayme Poisson, who hosts the CBC’s Front Burner podcast, says Carney’s speech has landed well in Canada with those who like the idea of being a middle power with power.
But there’s a debate going on in the wake of Carney’s speech over how realistic that strategy actually is.
“Because at the end of the day, we share this massive land border with the United States. We send 70 percent of our exports to the United States. So we’re not just like some random middle power. We are the middle power right next door to the hegemon and we are inextricably tied to them for security and economics … so you can see why people are debating here how much our role is to not rupture our relationship with the United States, and how much our role is to lead this pack of middle powers to do something more ambitious.”
Carney, she says, is “good at bluntly describing reality in a pretty sophisticated way. He was one of the first leaders to come out and say the world has changed … and our relationship with the United States is not what it was before.”
The speech has been criticised for Carney poking the bear when he didn’t have to, and when up until now he’s kept his head down.
But it’s possible Carney has just displayed the kind of strength and leadership that the US President so admires.
“They just spoke,” she says, “and Carney has reported that it was a fine conversation. And while we did see this response from the Americans – you know, mockery, you can’t live without the United States, and threat of a 100 percent tariff floated if we get close to China, that has not come to fruition. It’s just kind of subsided. So certainly that’s a pretty good argument to make – that he likes strength, he likes winners. And that he’s so mercurial that you might as well just stand up to him anyway, because you don’t really know what he’s going to do, day to day.”
Poisson says there’s a lot of anti-American sentiment in Canada right now and Carney’s remarks resonated. His approval rating rose eight points in the wake of the Davos speech, and is currently up at 60 percent.
“I think everybody [in Canada] thought this was a good speech,” she says. “I think the critiques are … was it smart? And is it going to come with consequences, and are those consequences worth it?”
Listen to the podcast to find out why Tim Groser isn’t entirely pessimistic about international developments, and why a rupture doesn’t mean collapse.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand