The timing of the tariffs doesn’t appear to be just a coincidence.
News Analysis
As Canada grappled with shifting U.S. tariffs last week, China added to the pressure over the March 8 weekend, slapping new tariffs on Canadian agricultural and food products effective later this month.
But the timing of the China tariffs coming only now, several months after Canada put
U.S.-matching levies on Chinese electric vehicles (EVs) and other products last October, doesn’t appear to be just a coincidence.
China’s state-run media CCTV has run
commentaries saying that the tariffs are meant to tell Canada not to side with the United States as Washington amps up the pressure on Beijing.
Comments by some officials in Canada show how this apparent tactic is being received.
China Tariffs
China announced tariffs on US$2.6 billion worth of Canadian goods on March 8, to take effect on March 20. The tariffs will be 100 percent on canola oil, oil cakes, and pea imports, and 25 percent on aquatic and pork products.
The move came after Canada
imposed 100 percent tariffs on Chinese-made EVs and 25 percent tariffs on aluminum and steel products effective last October, following America’s lead.
Shortly after
Ottawa first announced the tariffs last August, Beijing
launched an anti-dumping probe into Canadian canola imports, which officially is
still underway, and which China said may last for a year. The latest Chinese tariffs on Canada stem from a domestic “anti-discrimination” investigation the regime said it initiated last September.
Ottawa has called the tariffs “unjustified” and
rejected the basis of China’s probe, saying Canada “ensures a level playing field” for Canadian businesses and supports “fair, rules-based” trade.
Target: China
U.S. President Donald Trump began taking stances against China during his first term in office, and he seems poised to escalate the measures in his second term.
Criticizing China’s “years of unfair trade practices,”
including dumping, forced technology transfer, over capacity, and industrial subsidies, Trump imposed several rounds of tariffs on the country in his first presidency, covering US$360 billion worth in Chinese goods by 2019. China retaliated multiple times, bringing both countries closer to a trade war.
Trump cited China’s dumping practices as his main concern as he announced tariffs on steel and aluminum imports, including on those from Canada and Mexico, in March
2018. In an attempt to dissuade Trump from including Canada in the tariffs, Ottawa on March 27
brought forward
regulatory changes to crack down on steel and aluminum dumping from countries like China. The U.S. tariffs on Canada were eventually removed in May 2019 after Canada put in its own retaliatory tariffs against the United States.
Joe Biden maintained Trump’s tariffs on China during his presidential term, and in some areas expanded them.
His administration
announced higher tariff rates on China in May 2024, including increasing the duties to 100 percent on EVs, 50 percent on semiconductors and solar cells, and 25 percent on aluminum and steel products.
Canada
followed suit shortly after, saying in August that it will impose 100 percent tariffs on Chinese EVs starting Oct. 1 and 25 percent tariffs on Chinese steel and aluminum products starting Oct. 15.
The move was in lockstep with that of the United States. Canada had previously had a run-in with the U.S. administration concerning EVs, which Ottawa has heavily invested in, during the early days of Biden’s presidency. In 2021, when Biden
proposed tax credits for American-made EVs, Canada
threatened retaliation, saying that the U.S. tax credits would put Canadian manufacturers at a disadvantage and violate the U.S.-Mexico-Canada Agreement (USMCA) trade deal. Washington and Ottawa eventually reached a resolution to level the field for Canadian manufacturers.
The
European Union also brought in tariffs on Chinese EVs last October.
In Trump’s second term, amid the chaos of his on-again, off-again tariffs on Canada and Mexico, the only country-specific tariffs that have gone through without change have been the ones on China.
On Feb. 3, as Trump announced a
30-day pause to blanket 25 percent tariffs on Canada and Mexico, he went ahead with his
order to impose an additional 10 percent tariff on China on top of existing Chinese import taxes, effective Feb. 4.
Then on March 4, as
the pause ended on the Canada and Mexico tariffs and those levies went ahead, Trump at the same time
increased the tariff on China to 20 percent. However, the next day, he
paused for one month the tariffs just on the North American auto sector, and a day after that, paused for one month the tariffs on products that fall under the USMCA.
Aligning With US
While trying to catch their breath amid the flurry of U.S. tariff announcements, some Canadian cabinet ministers and premiers have signalled to the Trump administration that the two countries should align to target China instead of each other.
Finance Minister
Dominic LeBlanc said on March 7 that Canada wants to work with the United States to stop China from “dumping into the North American market.” His comments came after announcing Canada was pausing retaliatory tariffs on C$125 billion worth of U.S. goods while maintaining tariffs on C$30 billion worth of U.S. products, since the United States had paused some of its tariffs.
Canada announced further retaliatory measures against the United States on March 12, targeting C$29.8 billion worth of U.S. goods, the same day the United States went ahead with 25 percent tariffs on aluminum and steel from all countries, including Canada.
Energy Minister
Jonathan Wilkinson, while visiting Washington in January in an effort to dissuade Americans from using tariffs against Canada, told U.S. lawmakers that their country should use Canada’s help and partnership to achieve energy dominance and stand up to China.
“Beyond friendship and our economic partnership, we are steadfast partners on the world stage—which is ever more important these days, given the increasingly aggressive behaviour of certain international actors, including China,” Wilkinson said on Jan. 15.
Foreign Affairs Minister
Mélanie Joly said on Feb. 28 that Ottawa is open to a suggestion by U.S. Treasury Secretary Scott Bessent that Canada should match U.S. tariffs on China. Bessent had made the comments during an interview with Bloomberg after Mexico proposed matching China tariffs, saying “it would be a nice gesture” if the three countries could form “‘Fortress North America’ from the flood of Chinese imports.”
Some Canadian premiers have used even stronger words.
Soon after Trump’s election, as he first started talking about tariffs on Canada, Ontario Premier Doug Ford
urged the United States to sign a separate free trade agreement with Canada outside of the USMCA, saying Mexico is serving as a “backdoor” for Chinese goods.
“If Mexico won’t fight transshipment by, at the very least, matching Canadian and American tariffs on Chinese imports, they shouldn’t have a seat at the table or enjoy access to the largest economy in the world,” Ford said.
Later in November, while speaking as chair of the Council of the Federation on behalf of premiers, he
said all the premiers are aligned with him on the idea that Canada sign a bilateral deal with the United States since “we know Mexico is bringing in cheap Chinese parts, slapping made-in-Mexico stickers on, shipping it up through the U.S. and Canada, causing American jobs to be lost, and Canadian jobs.”
Alberta Premier Danielle Smith
made similar comments, saying in January to Americans, “We can strengthen our partnership even further in the coming years by securing our shared border and fighting unfair Chinese trade practices that harm workers in both of our countries.”
Reactions to China’s Tariffs
However, if China’s new tariffs on Canada are designed to make Canadian officials have second thoughts about aligning with the United States against Beijing, the impact has been varied.
B.C. Premier David Eby on March 10 asked Ottawa to revisit its tariff policies, saying Canada’s tariffs on China “to curry favour” with Trump have not been effective. He said China’s tariffs are having a major impact on his province, and asked Ottawa to take action to ensure Canada doesn’t get “crushed” between the American and Chinese economies.
Saskatchewan Premier Scott Moe noted that Ottawa has taken a number of measures to counter the U.S. tariffs, without saying he necessarily endorses them, and asked why the federal government isn’t responding to China’s tariffs which he said disproportionately impact the Western provinces.
Prime Minister-designate Mark Carney, who will soon replace Justin Trudeau, has
said he will maintain Canada’s tariffs on the United States until the Americans “show us respect.” He has also
called the confrontation with the United States “the greatest crisis of our lifetime.”
Moe
said in a post on social media that “thousands of jobs depend on canola production and processing in western Canada,” and asked Carney what his plan was with regard to China’s tariffs.
“Whether or not you agree with the federal govt’s response to US trade actions, there is no doubt they have taken action and reacted quickly, as they should,” he wrote. “But when it’s an exclusively western Canadian industry like canola under attack from Chinese tariffs… crickets.”
So far, neither Trudeau nor Carney have commented on the China tariffs.
However, Industry Minister François-Philippe Champagne has said Canada will keep its tariffs on Chinese EVs as well as steel and aluminum.
Champagne was
asked during an interview with the CTV’s Power Play program on March 12 whether Canada is reconsidering its posture towards China given the current situation.
Champagne narrowed the scope of his response specifically to the previously announced Canadian tariffs on China, saying, “not with respect to the tariffs.”
“We would never be a back door to cheap Chinese vehicle which are overly subsidized and where they don’t respect labour law and environmental laws,” he said. “They’re dumping, you know, steel in North America and you see these cheap vehicles coming here.”
Nova Scotia Premier Tim Houston said Canada needs to diversify its markets.
“With the added tariffs from China on seafood, our exporters are worried. We are actively working on finding new markets for our world class seafood,”
he said on March 12.
China previously put bans on several Canadian imports in 2019 after the arrest of Huawei executive Meng Wanzhou in Vancouver on a U.S. extradition request in December 2018. The bans were eventually lifted in 2022 following the release of Meng in 2021, with China also releasing two Canadian citizens it had detained in apparent retaliation.
