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The tariffs launched by U.S. President Donald Trump were part of a rising 鈥渆ra of economic nationalism鈥� that Carney said required strong measures to transform the Canadian economy so it is less reliant on American trade and anchored by industries that will receive billions of dollars in loans, aid and federal government contracts.聽

The prime minister, fresh off a two-day cabinet retreat in Toronto, said his government was “meeting this moment with the most comprehensive suite of trade resilient measures in Canadian history.”

“Our new government is embarking on an ambitious plan to secure a new era of prosperity out of this age of adversity. Our new industrial strategy will help transform our economy from being overly reliant on the United States, to one that is more resilient to global shocks,” he said at a news conference in Mississauga, with members of his front bench lined up behind him.

Among the measures announced Friday are a program that aims to train 50,000 workers and extend jobless benefits to give the unemployed more time to acquire new skills, and a $5-billion fund聽for sectors hit hard by trade turmoil, such as Ontario鈥檚 auto sector, to help them retool factories or expand and find customers in new markets.

The government is also rewriting its own procurement policy, Carney said, making it a 鈥渃lear obligation鈥� for Ottawa to 鈥渂uy Canadian鈥� in all its contracts 鈥� including for infrastructure spending 鈥� and ensure Canadian materials are used when domestic companies 鈥渢ruly鈥� aren鈥檛 available.聽On top of that, Ottawa will increase government agency loans to small- and medium-sized businesses, as well as canola producers hit by Chinese tariffs.

At the same time, the government鈥檚 drift away from policies it planned and implemented earlier under prime minister Justin Trudeau continued Friday. In pausing the zero-emission vehicle mandates, some environmentalists saw a weakening of climate policies that began when Carney scrapped the federal minimum consumer carbon price earlier this year.

The government also said Friday that it plans to change the Clean Fuel Regulations, another core climate measure from the Trudeau government, which Carney and other government officials said were meant to help Canada鈥檚 biofuels industry. Environment Minister Julie Dabrusin told the Star the changes are 鈥渢argeted鈥� and aren鈥檛 meant to weaken the policy鈥檚 purpose, which is to ensure fuels burned in Canada create fewer greenhouse gas emissions that cause climate change.

鈥淚t’s to promote the domestic industry. It’s not about stringency,鈥� she said Friday.聽

The retreat on the emissions-free sales mandate, however, highlighted how the weight of the trade wars with the U.S. and China聽鈥� Canada鈥檚 biggest trading partner聽鈥� is pressuring domestic policies as the economy shudders. Statistics Canada reported in August that economic output dropped in the second quarter of the year, while figures published Friday showed unemployment rising to 7.1 per cent, with 66,000 jobs lost in August.聽

Before pausing the EV sales mandate, the Carney government also cancelled Trudeau-era policies to raise capital gains taxes, scrapped the consumer carbon price, and聽鈥� under pressure from Trump聽鈥� ditched a long-planned Digital Services Tax that would have impacted major American web companies.

Appearing before a partially built聽Dash-8 plane at a factory in Mississauga, Carney lamented the recent job losses and said his government must act to bolster Canadian businesses, strengthen the economy, and find new markets overseas to reduce the 鈥渧ulnerability鈥� of Canada鈥檚 reliance on trade with the U.S.

He also treaded carefully around questions about Canada鈥檚 commitment to fight climate change, stressing that while reducing emissions must continue to be a priority, the government has to focus on maintaining Canadian competitiveness. He promised a new “climate competitiveness” strategy is in the works, but did not repeat promises from this year’s Liberal leadership race, when his campaign told the Star he would exceed current emissions reduction targets if he took power.聽

“Dealing with climate change is a moral obligation,” Carney said in French. “But at the same time, it’s a trade imperative. It’s a competitiveness imperative as well. Right now, we’re focusing on the competitiveness of our businesses here in Canada, of our workers as well.”

With plans to use its controversial new law to fast-track major development projects, Finance Minister Fran莽ois-Philippe Champagne defended the government鈥檚 openness to quickly approving new fossil fuel infrastructure. That includes oil pipelines, potentially in areas like northern British Columbia, where Alberta Premier Danielle Smith wants to see infrastructure built to boost exports to Asia.

“I聽think Canadians understand how the world has changed. Canadians wants to make sure that we look at our resources in a responsible and sustainable way,” Champagne told reporters after Carney’s news conference.聽

“It’s about time that we look at 鈥� Canada as a responsible, sustainable producer of natural resources.”

The Star reported earlier this year that the Carney government is open to weakening or cancelling a planned emissions cap for the oil and gas sector 鈥� the largest annual contributor to Canada鈥檚 greenhouse gas pollution 鈥� if a major carbon capture project goes ahead in Alberta and can achieve similar emissions reductions.

“What was the point of electing Mark Carney when we get Pierre Poilievre’s climate policy? We should be aligning with Europe, which is doubling down on renewable energy and electric vehicles, rather than bowing before Trump’s attack on people and planet,” Keith Stewart, an energy strategist with Greenpeace Canada, said in a written statement on Friday.聽

Joanna Kyriazis,聽a policy director with Clean Energy Canada, said it will be important for some form of sales mandate to remain since transportation emissions are Canada’s second biggest source of greenhouse gas pollution.聽

“This policy is one of the key tools that we have to cut carbon pollution in Canada,” Kyriazis said. “Especially after the consumer carbon price was repealed, this policy is going to do a lot more heavy lifting.”

Conservative Leader Pierre Poilievre, who spent years lampooning climate policies under the Trudeau government, has recently condemned the zero-emission vehicle sales mandate as a “ban” on gas-powered cars that Canadians rely on, especially in rural areas. On Friday he dismissed the delay and review as a “clumsy retreat” that doesn’t provide clarity to businesses about consequential government regulation.聽

“So now businesses who would otherwise consider investing in automaking here in Canada will have to put that investment on hold while Mark Carney dithers for another year to try and figure out how he can ban people from putting gas and diesel in their trucks and cars,” Poilievre said Friday at a news conference on Parliament Hill.

Under Trudeau, the government pledged to slash national emissions to 40 per cent below 2005 levels by 2030, and 45 per cent below that 2005 levels by 2035. Carney insisted Friday that the government is committed to reducing emissions, but did not specifically endorse those targets.

Pressed on whether the goal is changing, Dabrusin said “we’re absolutely continuing to be committed to fighting climate change and to doing what we need to do to meet our climate objectives as a country.”

But in two days of meetings this week at a hotel in North York, it was clear that the economy and the trade war are the government鈥檚 top preoccupations. Cloistered in the basement of the hotel, Carney and his cabinet spent hours shut away in discussions with a bevy of experts on the housing crisis, economy, and shifting global relations. They also stressed in interactions with reporters that the upcoming fall budget would focus on spending restraint, as well as “investments” to grow the economy聽鈥� a push and pull that includes a review meant to find $25 billion in annual budget savings within three years, and major new commitments to bolster the military with tens of billions of dollars in annual new spending.聽

At the same time, Canada鈥檚 top bureaucrat, Clerk of the Privy Council Michael Sabia, returned from Washington as talks with the Trump administration zero in on what Carney called a series of 鈥渟mall鈥� agreements to reduce American tariffs on sectors the U.S. has targeted for self-described national security reasons.

These include 50 per cent tariffs on Canadian steel and aluminum, 50 per cent tariffs on Canadian copper, 25 per cent tariffs on Canadian autos, and targeted import duties on lumber.

The government is also working on a new Defence Industrial Strategy that, as Industry Minister Melanie Joly explained to reporters at the hotel on Thursday, is meant to ensure the massive planned spending to bolster the military grows Canadian industry and uses domestic materials like steel. The same goes for housing, as the Carney government prepares to launch a new agency meant to help double the rate of annual housing construction to ease the supply crunch that has contributed to the country’s housing woes.聽

“We need to make sure that we’re building back capacity in the stroke capacity in Canada. And for a long, long time, we didn’t use the power of procurement for defence, for Canadian Armed Forces, as a way to leverage jobs in our country, and we’re the only G7 country that doesn’t have a defence industrial strategy that time is up,” Joly said.聽