China’s Foreign Ministry said on Wednesday that the country’s most recent trade deal with Canada is not intended to target or affect any other nation.
Spokesperson Lin Jian made the remark in response to an AFP reporter’s question about the most recent threats made by US President Donald Trump earlier this week.
“China and Canada are building a new type of strategic partnership, reflecting the principles of equality, openness, inclusiveness, peaceful cooperation, and mutual benefit,” the spokesperson said.
The deal allows for the annual import of 49,000 Chinese EVs at a reduced tariff of 6.1% — in exchange for lower duties on Canadian agricultural products — and “aligns with the common interests of both peoples.”
Lin Jian also mentioned that it “contributes to world peace, stability, and development,” and is not aimed “at any third party.”
The deal has faced strong criticism from Washington, as the country has been trying to keep Chinese competition out of North America by imposing tariffs exceeding 100% on such imports.
In 2024, when the Biden Administration quadrupled the tariffs on imported EVs from China to 100%, Canada matched the duties.
The latest developments have, however, strained trade relations between the two North American countries, which were already tense due to the US duties imposed last year on the auto industry.
Canadian-manufactured vehicles that don’t qualify for duty-free trade under USMCA had their tariff raised from 25% to 35%, on top of an already-existing 15%.
These tariffs prompted US automakers to reduce production in Canada and led Ottawa to seek partnerships with other countries, including China and South Korea, to build up its auto industry.
Germany is the latest nation to signal interest in expanding its automotive presence there.
Amid production cuts and layoffs in Canada, General Motors‘ CEO Mary Barra has criticized Ottawa’s tariff deal with China, saying it goes against building a strong North American manufacturing footprint.
As renegotiations of the USMCA approach, US Commerce Secretary Howard Lutnick said that the Canada-China deal could pose a threat to it.
Speaking about the free trade deal in mid-January, US President Donald Trump said “there’s no real advantage to it” and that “it’s irrelevant” for the US.
On the other hand, he added that “Canada would love it. Canada wants it. They need it.”
Trump Threats
This Monday, Trump said the US would block the opening of a new bridge between Detroit, Michigan, and Windsor, Ontario — key industry areas — until the United States is “fully compensated for everything we have given them [Canada].”
Saying the “massive bridge between Ontario and Michigan” is owned by Canada in both sides, and build “with virtually no US content,” Trump complained that “now, the Canadian Government expects me, as President of the United States, to PERMIT them to just ‘take advantage of America’!”
“And now, on top of everything else, Prime Minister Carney wants to make a deal with China,” he added.
The President claimed that China “will eat Canada alive,” and the United States will “just get the leftovers.”
While the President initially endorsed the Canada-China deal, he has later threatened to impose a 100% tariff on the neighboring country if it went through.
“If Governor Carney thinks he is going to make Canada a ‘Drop Off Port’ for China to send goods and products into the United States, he is sorely mistaken,” Trump wrote a few weeks ago.
Canada Auto Industry
China’s Ambassador to Canada Wang Di has weighed in on the recent tariff deal between the two countries, telling The Canadian Press earlier this month that it will create more jobs in the automotive industry and help consumers buy more affordable vehicles.
The Canadian government does not view the deal as an economic threat, seeing it instead as part of a broader strategy to eventually produce Chinese EVs in Canada.
Upon announcing the deal last month, Carney said “it is expected that within three years, this agreement will drive considerable new Chinese joint-venture investment in Canada with trusted partners to protect and create new auto manufacturing careers for Canadian workers, and ensure a robust build-out of Canada’s EV supply chain.”
That strategy was reaffirmed with the latest measures to support the auto industry, announced last week.
Over the weekend, Carney wrote on X that Canada’s “new strategy will build a stronger Canadian auto sector, where Canadian workers build the cars of the future and sell them to the world.”
The comments were made two days after Industry Minister Mélanie Joly announced that the government is in talks to establish a joint-venture EV plant with Chinese automakers for global exports.
Canada EV Scenario
The Canadian Government announced last week that it will implement a five-year EV Affordability Program to lower the cost of EVs, alongside revised zero-emission targets.
The program replaces the Electric Vehicle Availability Standard implemented by former PM Justin Trudeau, which was suspended last year as the new administration reviewed the policy framework.
The EV Affordability Program provides incentives of over CA$5,000 for battery and fuel electric vehicles and CA$2,500 for plug-in hybrids.
Incentives apply to vehicles priced up to CA$50,000 and made in countries with free trade agreements; the price cap does not apply to domestically produced vehicles.
