Canada is “absolutely” considering following a major proposal by the United States to ban Chinese automotive technology, Finance Minister Chrystia Freeland told reporters Tuesday.
This comes after the White House announced Monday a proposal to ban Chinese software and hardware in connected vehicles on American roads due to national security concerns.
The move would mark the latest crackdown on China’s automotive industry by the Biden administration and would effectively bar all Chinese cars from entering the U.S. market.
It also raises questions about whether Canada will do the same, after matching America’s lead in slapping high tariffs on Chinese electric vehicles and weighing further restrictions.
When asked if Canada was considering a similar move, Freeland said, “The short answer is: absolutely.”
“A longer answer is our government has made very clear that we take really seriously intentional Chinese overcapacity and we take very seriously the security threat from China,” she added. “That’s why we acted decisively in imposing tariffs on Chinese EVs, on Chinese steel, (and) on Chinese aluminum.
“We are very mindful of the environmental standards, the labour standards, or I really ought to say the lack of environmental standards, lack of labour standards that underpin that production.”
Freeland said the Canadian government also had security concerns with allowing Chinese software in connected vehicles,which one expert described to Global News earlier this year as “rolling spy vans.”
After Canada recently followed the U.S. in introducing a 100 per cent tariff on Chinese-made electric vehicles and a 25 per cent tariff on Chinese steel and aluminum, the government launched a consultation process to impose further tariffs on Chinese batteries, battery parts, semiconductors, critical minerals and metals and solar products.
Freeland said discussions on Chinese software will be a part of these consultations.
“We are looking at whether we need to impose further measures and we’re doing that … in close consultation with Canadian industry (and) Canadian labour,” she said.
The planned regulation by the U.S. Commerce Department, which still needs to be finalized, would also force American and other major automakers in the coming years to remove key Chinese software and hardware from vehicles in the U.S.
A fact sheet from the White House says the proposed rule targets technology and components imported from “countries of concern,” which also includes Russia.
“When foreign adversaries build software to make a vehicle, that means it can be used for surveillance, can be remotely controlled, which threatens the privacy and safety of Americans on the road,” U.S. Commerce Secretary Gina Raimondo told a press briefing.
“In an extreme situation, a foreign adversary could shut down or take control of all their vehicles operating in the United States all at the same time — causing crashes, blocking roads.”
— with files from Global’s Sean Boynton.