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Will China and Canada ease their tariffs? What’s at stake in Carney visit

Click to play video: 'Ottawa considers lifting tariffs on Chinese EV’s'
Ottawa considers lifting tariffs on Chinese EV’s
WATCH: Prime Minister Mark Carney will look to ease Chinese tariffs on Canadian canola during his trade mission to China but he'll need to agree to either drop, or lower, tariffs on Chinese electric vehicles to get a deal done. Global News Morning speaks with David Adams of Global Automakers of Canada about what that could mean for Canada's auto industry.

With U.S. President Donald Trump’s tariffs forcing Canada to seek other trading partners, Prime Minister Mark Carney’s visit to China is raising questions about whether some tariffs between Beijing and Ottawa could soon ease in what one expert is calling a “test” for where relations may go.

Canada’s rocky relationship with China has spanned several years, and pre-dates the global trade war sparked by Trump’s tariffs.

But recent diplomatic tension, including the arbitrary detention of two Canadians as well as the executions last year of four Canadians by Beijing, coupled with pressure from the U.S. for allies to crack down on trade with China have spurred rounds of tariffs between Canada and China covering industries like agriculture and electric vehicles.

Carney’s trip comes just days after an Ipsos poll done exclusively for Global News  found 54 per cent of Canadians support closer trade ties and economic agreements with China.

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“This visit by Carney to China is also a test. It’s very sensitive. It’s to test the Canadian public, also to test the U.S. reaction,” says Howard Lin, a professor emeritus and the founding director of the Canada-China Institute for Business and Development at Toronto Metropolitan University.

Some experts suggest that these meetings are a strategy by Carney to add pressure on Trump to come to the bargaining table and renew or negotiate an alternative to the Canada-United States-Mexico Trade Agreement (CUSMA), which is up for renegotiation this year.

Trump said earlier this week “it wouldn’t matter to me” if the current trade deal were to expire.

Here’s a look at where things stand ahead of Carney’s meetings with Chinese leaders.

Click to play video: 'Carney meets Xi in China under ‘new foreign policy’'
Carney meets Xi in China under ‘new foreign policy’

Why there are tariffs between Canada and China?

Relations between the two countries have been strained for nearly a decade.

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The most recent chapter of strain began in 2018, during Trump’s first term, when the RCMP arrested then-Huawei CFO Meng Wanzhou in Vancouver at the behest of American authorities.

Canada has an extradition agreement with the U.S.

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At the time, Wanzhou was an executive at the China-based global telecommunications technology company and was wanted in the United States on international fraud charges.

About a week later, China arrested two Canadians, who became known as the two Michaels, and would later be held on widely condemned charges of espionage and held for several years in China.

“Since the two Michaels situation, there’s been trouble with trade to China. That was completely unacceptable, a diplomat was kidnapped. And so I’m not really sure what’s changed. The same people are in power, the same economic conditions with China are still around,” says Kevin Bryan, an associate professor of strategic management at the University of Toronto.

“It’s not like we’re trying to increase trade to Sweden. We’re trying to increase trade to China, where we recently had serious economic espionage and serious geopolitical issues with that country.”

Carney has vowed to double non-U.S. exports over the next decade — and China is the world’s second-largest economy.

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“For Canada, this is kind of a pragmatic economic engagement, a reset. We have sectors like agriculture, which are really eager to re-enter the Chinese market,” says Lin.

“China’s objective is a little bit different. I think they would consider this visit as a strategic diplomatic win because in this political landscape, China wants to see they’re not totally isolated and considered a responsible partner that can be talked with.”

Click to play video: 'Canada’s canola producers watching as Carney heads to China for trade talks'
Canada’s canola producers watching as Carney heads to China for trade talks

What tariffs are in place now?

In October 2024, Canada began imposing a 100 per cent tariff on all imported electric and hybrid-electric vehicles produced in China, mirroring measures taken by the U.S. amid concerns about heavy Chinese subsidies and industrial dumping.

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Canada also has a 25 per cent tariff on Chinese steel and aluminum over similar concerns.

China retaliated to those moves with duties of their own. Shortly after Canada imposed those tariffs, China began investigating Canadian canola imports on similar claims of dumping.

Dumping in the context of exporting refers to when a business artificially lowers the price of its products to be significantly lower than its own domestic pricing standards.

The theory is by doing this, one nation’s industry can undermine that of another nation’s and make it difficult to compete with those products being imported.

In March 2025, China imposed a 100 per cent tariff on Canadian canola oil, canola meal and peas.

This was in addition to a 25 per cent tariff on Canadian pork and seafood products.

In August 2025, China also added a nearly 76 per cent tariff on canola seed.

China is the world’s largest importer of canola oil and canola products, with nearly all of it coming from Canada.  The Canadian canola industry generates more than $43 billion per year and employs about 200,000 workers, which have been given some financial supports from the federal government in the interim.

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Carney is being joined by Saskatchewan Premier Scott Moe in China, as canola farmers from the Prairie province say they are hopeful for some relief to their industry.

Click to play video: 'Sask. farmers optimistic for Premier Scott Moe, Carney China trip'
Sask. farmers optimistic for Premier Scott Moe, Carney China trip

What could come from Carney's meetings

Canola tariffs are widely expected to be among the items on the agenda for the meetings.

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But experts caution that Carney may have to offer some concessions to get any shifts from China.

Lin says it’s “almost guaranteed that China will reopen the agriculture market.”

“Western Canada is really a strong voice for a normalized relationship with China, and China will use that to argue that concession to be made from the Canadian side and then they’ll say, ‘what can we get?

“Maybe we just export more oil, or even clean energy. The Chinese are really focused on electric cars, steel and aluminum, but these things are very sensitive.

Dropping tariffs on Chinese EVs or steel and aluminum could be politically challenging, given U.S. focus on those industries and the push from the administration for countries to crack down.

The United States, and Trump himself will likely be paying close attention, and Bryan says “there’s a risk” that whatever comes from these meetings may affect the future of CUSMA.

There may still be other ways for Carney to build a bridge with Beijing.

Chinese media also suggested this week that in order to mend ties between Canada and China, Canada will need to represent itself independently from the U.S.

Lin says Carney and his team need to be “cautious” at these meetings given the stakes.

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“It’s kind of interesting that President Trump seems to have an American-only kind of attitude recently. He even said the trade agreement between the U.S., Canada and Mexico, ‘I don’t now if that matters’ or something. So, I think he has his own plan,” says Lin.

“I think Carney has to be cautious to say what we’ve got to say, because Canada still has a disagreement on the other front.”

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