Carney won’t say whether Canada will drop Chinese EV tariffs

CTV’s Jeremie Charron has the latest details on Canadian sectors most impacted by U.S. tariffs so far.

Following assurances from China’s ambassador to Canada that China would drop its tariffs on Canadian canola products if Canada scraps its levies on electric vehicles (EVs), Prime Minister Mark Carney won’t say whether that’s a move he’s ready to make.

Ambassador Wang Di made the comments in an exclusive interview with CTV Question Period last week, telling host Vassy Kapelos through a translator that China will “reciprocate accordingly” if Canada removes the “unilateral unjustified tariffs” on Chinese products.

Canada has had 100 per cent tariffs on all EVs imported from China since last October.

The previous federal government framed the move as an alignment with the U.S., and as a way to protect domestic manufacturing, accusing China is unfairly subsidizing its EV industry and flooding the market.

Canada also has 25 per cent tariffs in place on Chinese steel and aluminum.

China has since levied tariffs of its own on Canadian agriculture, notably on canola products, with a 100 per cent tariff on Canadian canola oil and meal and a 75.8 per cent tariff on canola seed.

Following Wang’s comments, Carney has faced pressure, notably from Prairie premiers, to drop Canada’s tariffs on Chinese EVs. Others, however, such as Ontario Premier Doug Ford, are staunchly opposed to the idea.

Asked directly on Thursday whether he’s prepared to drop the tariffs, Carney wouldn’t say.

“We get a lesson from the trade actions of the United States over this year, trade actions such as the canola tariffs you just referenced, the danger of overdependence on single trade partners,” Carney told reporters following an announcement in Etobicoke, Ont. “First point. The second is that in those contexts, we have to look for alignment of incentives and interests as much as possible.”

“It’s a similar process with China,” he also said. “We are restarting broad engagement with China.”

Carney also referenced his meeting late last month with Chinese Premier Li Qiang, China’s second-highest ranking official, on the sidelines of the United Nations General Assembly. It marked the highest political-level meeting between the two countries since 2018.

“This is our second largest trading partner,” Carney said. “So, when you have that, and there’s reasons for that, but when you have that situation, you end up with these dependencies and these exposures.”

“We have a broader trading relationship with China,” he added. “There are different levers that we have, or opportunities that we have, for China in Canada, and we are in the process of having those discussions on a much broader range of issues than single sectors and single trades.”

When pressed to explicitly say yes or no whether he’d drop the tariffs on Chinese EVs, Carney said it would be “naïve” to reduce a broad trading relationship to a specific sector.

“It’s a deeper set of conversations that are going on,” he said. “It’s not that simple, and nor is the relationship in the auto sector that simple as just ‘open a door here with China,’ with no impact on the relationship with the United States and the impact on activity here in Canada.”

Foreign Affairs Minister Anita Anand, meanwhile, is travelling to China to meet with her counterparts this week. Carney himself is set to meet with senior Chinese leadership before the new year.