The Liberal authorities has reached a cope with Beijing to slash tariffs on a set variety of Chinese language electrical automobiles in trade for China dropping duties on agriculture merchandise, Prime Minister Mark Carney stated Friday.
It marks the prime minister’s first deal on commerce since taking workplace final 12 months and a de-escalation in tensions with a rustic the Liberal authorities had, in recent times, branded a disruptive energy.
Carney described it as a “preliminary however landmark” settlement to take away commerce boundaries and scale back tariffs, a part of a broader strategic partnership with China.
“It’s a partnership that displays the world as it’s in the present day, with an engagement that’s reasonable, respectful and interest-based,” Carney stated at a information convention in Beijing.
Carney stated Ottawa expects Beijing to drop canola seed duties to fifteen per cent from 84 per cent by March 1, and referred to as that “monumental progress.”
Canadian canola meal, lobsters, crabs and peas will now not be topic to Chinese language “anti-discrimination” tariffs from March to no less than the top of the 12 months. There was no point out of canola oil, which is topic to a 100 per cent tariff.
In return, as much as 49,000 Chinese language electrical automobiles can be allowed into the Canadian market every year at a 6.1 per cent tariff as an alternative of the present 100 per cent tariff.
By 2030, half of these imported automobiles will value lower than $35,000 — a measure that Carney stated will guarantee EVs are extra inexpensive for Canadians.
He added the 49,000 automobiles represents roughly the quantity imported from China in 2023, earlier than the tariffs, and is lower than three per cent of the Canadian home auto market.
The pact comes simply hours after Carney met with President Xi Jinping, ending a multi-year commerce dispute that started when the earlier Liberal authorities levied EV tariffs to guard Canada’s auto sector.
In late 2024, Ottawa adopted strikes by former U.S. president Joe Biden and the European Union to counter China’s quickly rising electrical car trade.
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Former prime minister Justin Trudeau’s authorities imposed 100 per cent tariffs on Chinese language electrical automobiles, arguing the prospect of dumping low cost, closely backed EVs constituted a menace to the North American auto sector.
China responded in March 2025 with a 100 per cent tariff on Canadian canola oil, peas and different merchandise, together with 25 per cent on pork and seafood merchandise reminiscent of lobster.
The transfer halted exports of canola oil, strangled exports of canola meal and peas and throttled pork as effectively.
That was adopted by a levy of virtually 76 per cent on Canadian canola seed in August that 12 months, which ratcheted up stress on Ottawa from the Prairies to ease the escalating commerce tensions.
China’s anti-dumping investigation into canola seeds was set to wrap up in March.
Canada is the highest world exporter of canola and China is the trade’s second-largest market after the U.S.
Ottawa had additionally slapped a 25 per cent import tax on Chinese language metal and aluminum in October 2024.
Greg Cherewyk, president of Pulse Canada, was in Beijing as a part of the Canadian delegation and stated the deal was welcome information.
Tariffs had successfully stopped all shipments of Canadian peas to China, the world’s largest market, and Cherewyk stated Canadian yellow peas value about $700 million a 12 months have been displaced by Russian merchandise.
“It was actually necessary that this didn’t final so long as we had feared it will final, into the years. It was resolved in what actually quantities to a brief time period,” he stated, including that the timing is good for farmers in Canada to make seeding selections.
Only a 12 months in the past in the course of the spring election, Carney described China as the largest safety menace dealing with Canada. Talking to media Friday, his reply to a reporter’s query was much less clear-cut.
“The safety panorama continues to alter, and in a world that’s extra harmful and divided, we face many threats,” Carney replied when requested by a reporter. “You handle the threats via engagement.”
The deal additionally comes because the Liberal authorities seeks to double non-U.S. exports by 2030 — and increase them by 50 per cent to China by that date as effectively.
Carney stated he raised human rights within the assembly with Xi, and stated Canada has a “value-based realism” to its method.
“We basically rise up for human rights, for democracy, territorial integrity, rights to self-determination,” he stated. “We take the world as it’s, not as we want it to be.”
Carney and Xi met within the fall on the sidelines of the Asia-Pacific Financial Cooperation discussion board in South Korea. It marked the primary official assembly between the leaders of Canada and China since 2017.
On Friday, Xi described that as a “turnaround” in bilateral relations.
Within the wake of that key assembly final fall, each leaders directed their officers to work on resolving lasting commerce irritants.
Saskatchewan Premier Scott Moe travelled to China for among the top-level conferences — a key precedence for him because the tariffs have been punishing a serious Prairie crop. His province makes up for simply over half of Canada’s complete canola manufacturing.
Moe additionally travelled to China in September alongside federal officers, hoping to resolve the dispute.
Ontario Premier Doug Ford has maintained the EV tariffs ought to stay until China opens an EV manufacturing facility in Ontario and hires unionized Canadian employees.
Carney stated in French that Canada expects engagement on home funding, and famous the way forward for the auto trade is in electrical automobiles.
