She announced her resignation in a post on X, writing that she made the decision "with tremendous gratitude and a little sadness".

"I have decided to step down from cabinet today and turn the page on this chapter in my life. I do not intend to run in the next election," she said.

In his own statement, Carney thanked Freeland "for her extraordinary service in the Cabinet of Canada's federal government over the last decade".

He added that he asked her to serve as Canada's new Special Representative for the Reconstruction of Ukraine, in addition to her role as a Liberal MP.

Earlier this year, Canada committed an additional C$2bn ($1.46bn; £1bn) in military assistance to Ukraine. Carney later made a surprise visit to Kyiv in August.

Freeland, a former journalist who is of Ukrainian heritage, has long been a vocal supporter of Ukraine in its ongoing war with Russia. In 2014, she was placed on a Kremlin list of westerners who were banned from entering Russia in retaliation of sanctions against Moscow.

Since May, she had been serving as Transport and Internal Trade Minister under the Liberal Carney government, overseeing efforts to dismantle internal trade barriers between provinces as Canada works to address the impact of US tariffs.

In 2020, Freeland became the first woman to be appointed as finance minister in Canada's history, where she managed Canada's financial response to the Covid-19 pandemic.

She abruptly resigned from that post in December 2024 via a letter shared publicly on X, hours before she was due to table a government fiscal update.

In the letter, Freeland called out former Prime Minister Trudeau for "costly political gimmicks" and said the two had been "at odds about the best path forward for Canada."

The resignation triggered the fall of Trudeau's political career. He later resigned as prime minister in January after nine years in office.

Freeland later ran to replace Trudeau as Liberal Party leader but lost to Carney.

She is also credited with helping renegotiate the current free trade agreement between Canada, the US and Mexico during President Donald Trump's first term in 2018. Trump later called her "toxic".

The USMCA trade deal - or CUSMA in Canada - has been credited with helping the country largely avoid a stiff 35% tariff rate imposed by Trump, who granted Canada a carve out for goods covered by the free trade agreement.

That deal is now up for another round of renegotiations in 2026.

In her post on X, Freeland said her decision to resign was not made "to spend more time with my family or because the burden of elected office is too heavy to bear".

"For me and for my wonderful husband and children, public service has been a privilege and not a sacrifice," she said.

"I am grateful for every minute, and I hope more Canadian girls and women will step up and seek the joys and rewards of elected politics for themselves and for their families."

Canada's Chrystia Freeland quits cabinet to become Ukraine envoy