Canada's Finance Minister Chrystia Freeland resigned on Monday following a clash with Prime Minister Justin Trudeau over key policy issues, including the handling of potential US tariffs.
His departure, which he announced in a strongly worded resignation letter, adds further tension to an already beleaguered Liberal government.
Freeland criticized Trudeau's push to increase spending, calling it a “political stunt” that could weaken Canada's ability to manage the looming threat of 25% import tariffs promised by US President-elect Donald Trump.
According to Reuters, his resignation came after a tense meeting with Trudeau last Friday, during which he proposed that he take on a reduced role after weeks of disagreements over fiscal policy.
Freeland's decision to resign came just hours before she was due to present the autumn economic update, which is expected to reveal a much larger 2023/24 budget deficit than initially forecast. Government officials confirmed that the document would be released as planned.
Freeland, 56, also served as deputy prime minister and was considered a key ally of Trudeau. His departure has sparked speculation about the stability of his leadership within the Liberal Party.
“This will likely trigger a leadership crisis within the liberal group… [it] “It's politically and personally devastating for Trudeau,” said Nik Nanos, founder of the polling firm Nanos Research.
The Liberal Party, in power since 2015, has been grappling with declining approval ratings. Polls indicate the party faces likely defeat in the next federal election, scheduled for October 2025.
A former journalist, Freeland held high-profile positions, including Trade Minister and Foreign Affairs Minister, before assuming the Finance portfolio in August 2020. As Finance Minister, she led Canada's economic recovery efforts during the pandemic era.
Prime Minister Trudeau, who appeared at a cabinet meeting scheduled shortly after the resignation, avoided questions from reporters. His cabinet colleagues were visibly moved by the news.
“This news has hit me very hard and I will reserve further comment until I have time to process it,” said excited Anita Anand, president of the Treasury Board.
Political analysts say Trudeau's position remains secure for now, as Canadian political leaders are elected during special conventions. However, the fallout from Freeland's resignation could deepen internal party dissent.
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