The New Geopolitics of Trade and Energy with Rachel Ziemba
The Takeaways
Economic policy has become a tool of geopolitical competition. Governments are using tariffs and sanctions to advance national objectives.
Market adaptability is replacing efficiency. Countries and governments are diversifying supply chains, expanding export routes and reducing dependence on individual trading partners.
Businesses need geopolitical intelligence. As policy volatility becomes a defining feature of international commerce, understanding why governments act is just as important as understanding market fundamentals.
Scenario analysis is key: Companies need to stress-test their plans to make sure they are robust across plausible scenarios and even some high risk-probability ones. Inaction is dangerous, but so is being unprepared.
Hi everyone, I’m Danielle Dillon, business development associate at Nüora Global Advisors.
First of all, Nuora Global would like to acknowledge the state of emergency in B.C., where we are headquartered, due to wildfires displacing more than 20,000 people across the province. The following organisations are accepting donations to help wildfire relief efforts and are great options to consider supporting:
Last month, our team welcomed geoeconomic risk analyst Rachel Ziemba to our roundtable event in Vancouver. Ziemba specialises in economic statecraft, particularly the relationship between energy markets, sanctions, and sovereign investment. As a recent international relations graduate from the University of British Columbia, it was a treat to listen to Ziemba speak from her practical experience in geoeconomic risk assessment.
Our conversation was shaped by immediate responses to President Donald Trump’s plans to impose a 50 percent tariff on up to $20 billion of Canadian imports. Arriving directly from work, many guests working in media and research were grateful that the news broke on the East Coast three hours before offices closed on the West Coast, giving them time to catch up. Most agreed that tariff threats had become a common practice since Trump’s second administration took office. You can read Ziemba’s quick take on her Substack newsletter.
The announcements reinforced the broader trend of governments increasingly using tariffs, sanctions, critical infrastructure, and financial policy as instruments of geopolitical competition and resilience.
During the discussion, Ziemba—founder of Ziemba Insights—explored how this trend is reshaping Canada’s energy strategy, North American trade and the global business environment more broadly. She called this “pipeline season”.
This newsletter recap is cross-posted in Ziemba’s excellent newsletter, Weaponized Economy.
Trump has normalised tariffs as a negotiating tool
Recent tariff announcements are often framed as disputes over dairy quotas, provincial liquor policies or market access. Instead, Ziemba suggested that Washington is using tariffs as “economic leverage”. That message is also meant for far-away partners, including Europe.
With the renegotiation of CUSMA/USMCA underway, Washington’s willingness to threaten tariffs illustrates how trade policy has evolved beyond economics. Rather than working together on further integration, Washington is using the tactic to signal to Canada, Mexico, and others that “if you fight back... you’ll get more.”
“These threatened tariffs, which could come into effect on August 19 if no agreement is met, further erode the benefit of trade agreements like CUSMA by hacking away at the CUSMA exemption which cushioned some Canadian producers in the last year, albeit at the cost of a lot more paperwork,” Ziemba said.
Equally revealing are the products that remain exempt from Trump’s latest volley: Canadian energy exports, potash and critical minerals - the goods the US wants. Instead, the tariffs are “ostensibly linked to three areas of grievance where the US thinks that Canada has policies that disadvantage” them. Their exclusion from the list exemplifies the extent to which economic interdependence constrains the possibility of sustained trade intimidation. For businesses, however, uncertainty itself has become a cost that is borne unequally.
Large multinational corporations often possess the legal and financial resources to adapt to changing customs rules or absorb short-term disruptions. They may be able to transfer goods across borders. Small and medium-sized businesses face a much more difficult environment as “so much policy volatility makes it very hard to plan” around changing compliance requirements.
The broader lesson is that policy volatility is no longer an exception—it is becoming a feature of modern trade. “We aren’t going back to normal, which brings both opportunities and costs,” said Ziemba.
“Pipelines alone won’t solve Canada’s challenges.” ~ Rachel Ziemba
Canada’s pipeline debate is about strategic resilience
Energy infrastructure was another recurring theme throughout the discussion, but not simply as an environmental or economic question.
Instead, Ziemba framed Canada’s pipeline debate as a question of strategic flexibility.
For decades, Canada’s energy exports have been defined by unilateral dependence on the United States. While that relationship remains important, given proximity and interdependence, economic reliance on a single customer creates obvious vulnerabilities. This is not unlike the vulnerability that a single source may present. Even in better times, structural changes can occur that shift demand. For example, the US shale boom, and more recently, a forced shift in Venezuela’s trade that brought more competition to Canadian markets.
Projects such as the Trans Mountain expansion and new LNG export terminals are therefore about more than increasing production capacity. They create alternative pathways into Northeast Asian markets while reducing Canada’s dependence on a single export destination. Canadian exports direct to Asia have increased in this context. A new pipeline west, parallel to the existing one, could add to these trends.
The conversation also examined the evolving expectations of international energy buyers and the important role of the indigenous owners within Canadian energy projects.
Countries such as Japan are increasingly weighing the environmental and ethical footprint against price and reliability. Asked about whether fossil fuel demand is robust enough to justify these investments - and the costs of doing so to a world already warming, Ziemba pointed to tradeoffs and a potential new model. Measures that reduce methane emissions, minimize flaring, and improve overall production standards are becoming part of Canada’s long-term competitive advantage—not simply environmental policy.
“Pipelines alone won’t solve Canada’s challenges,” she said. “One big challenge remains how to foster innovation and investment beyond the resource sector. In times of crisis, one can make shifts - reducing domestic trade barriers remains a big one and one that will help Canada’s economy and make exports more competitive.”
Diversification has become a crucial geopolitical strategy
One of the strongest themes to emerge from the roundtable was that today’s geopolitical competition is increasingly defined by diversification and egress optionality.
China, for example, has consistently sought to avoid excessive dependence on any single supplier of energy imports. That strategy limits the leverage of partners such as Russia during negotiations over projects like the proposed Power of Siberia 2 pipeline. Since the Russian invasion of Ukraine, the country has lost close to 150 billion cubic meters of gas exports to the West per year. Moscow has limited options compared to Beijing, which already imports pipeline gas from Turkmenistan and LNG from Qatar and has been increasing its own production. It’s clear that China holds the upper hand and can bargain on price.
“Chinese resilience also stems from the shifts to more electrification and local supplies, and ample stockpiles. These shifts have enabled a significant reduction in imports in the wake of disruptions. Other countries too have leveraged their savings,” Ziemba said.
Countries with stockpiles of energy, and other critical materials have more choices in crisis and may be less vulnerable in times of scarcity. Canadian efforts to coordinate with G7 on mineral stockpiles are but another source of hedging to help address fundamental gaps. The challenge remains one of coordination and who will pay for that flexibility and optionality, according to Ziemba.
Rather than maximizing efficiency, governments are increasingly prioritizing flexibility and encouraging companies to do the same. The same logic extends well beyond bilateral relationships.
Disruptions affecting shipping through the Red Sea and Strait of Hormuz, uncertainty surrounding Middle Eastern energy routes, and evolving relationships between Russia, China, and Western economies, all reinforce the importance of maintaining multiple sources of supply and multiple export destinations.
For Canada, expanding Pacific export capacity is therefore not simply about accessing new markets. It is part of a broader effort to ensure that changing geopolitical conditions do not leave the country overly dependent on any single economic relationship. Doing so will be a test of government coordination and the new effort to streamline projects.
Engagement with China requires greater precision, not simpler answers
The discussion also explored Canada’s evolving relationship with China amid intensifying competition.
Public attitudes toward Beijing have become increasingly cautious in both Canada and the United States. At the same time, opportunities for direct engagement have diminished, creating new challenges for policymakers and businesses attempting to understand developments inside China.
Ziemba noted that “the lack of interaction has its own risks.” As governments, companies and researchers have fewer opportunities to engage directly, the likelihood of information gaps and strategic miscalculation increases.
Rather than framing the relationship as one of either engagement or disengagement, the conversation suggested that Canada’s approach may increasingly need to be sector-specific—maintaining close alignment with the United States, G7, and likeminded countries in some strategic industries while continuing pragmatic cooperation with China where Canadian interests remain aligned.
Such an approach reflects a broader reality of today’s geopolitical environment: competition and cooperation increasingly coexist rather than replace one another.
“We aren’t going back to normal, which brings both opportunities and costs.” ~ Rachel Ziemba
Expertise remains a competitive advantage in the age of AI
The roundtable concluded with a discussion about the changing information economy and the future of expert analysis.
Digital publishing platforms have lowered the barriers to entry for independent researchers, while generative AI has dramatically increased access to information. Yet Ziemba argued that these developments have not reduced the value of expertise—they have changed where that value lies.
Information itself is becoming increasingly commoditized because many clients assume, “I can just run this through my generative AI.” However, AI doesn’t necessarily ask good questions or understand the nuances of local developments. Deep understanding of cultural norms, history and precedent is even more essential. In a time of distrust and silos, people are looking for cross-cutting insight tailored to their needs.
Competitive advantage now comes from interpreting information within specific political, commercial and operational contexts. Businesses rarely need more headlines; they need better judgment and to understand what it means for them.
Ziemba emphasized the importance of consuming information across a wide range of sources—from publications such as the Financial Times, Bloomberg, The Economist, The New York Times, Globe and Mail and the South China Morning Post, to well curated social media fields. Among the most useful are gut-checks within trusted expert networks. Understanding both the strengths and biases of different sources is an even more important analytical skill.
For organizations operating internationally, geopolitical intelligence is no longer a luxury. It is becoming an essential component of strategic decision-making. Inaction is too costly. Instead, businesses must stress-test decisions against different scenarios.
Joanna Chiu discusses NATO spy case on CBC
In late July, managing partner Joanna Chiu joined CBC News’ Andrew Nichols for a wide-ranging conversation on the arrest of a Canadian accused of espionage by Belgian authorities. What does this case say about Canada’s intelligence network? How do we draw the line between espionage vs foreign influence?
Chiu cautioned that high-profile cases like this one risk fueling tendencies to profile people of Chinese heritage. What’s needed instead is a robust, nuanced understanding — not blanket suspicion. This case is a reminder that understanding China takes more than language skills, the importance of lived experience by those who can offer clear analysis from the inside, and why Canadian institutions need to make sure they are doing enough to recruit and retain that kind of talent.