Prime Minister Mark Carney is set to travel to China in an effort to ease longstanding diplomatic tensions and address a significant trade issue between Canada and China involving high tariffs on Chinese electric vehicles and agricultural products. The Chinese ambassador to Canada has indicated that if Canada removes its electric vehicle tariffs, China would reciprocate by lifting its retaliatory tariffs.
While Canadian officials anticipate progress during the Beijing visit, they do not expect an immediate resolution to eliminate what they deem as China’s unjust tariffs. Vina Nadjibulla, the vice-president of research and strategy at the Asia Pacific Foundation of Canada, believes that although a definitive solution may not be reached right away, there could be positive signals regarding the direction of negotiations.
Carney’s upcoming four-day trip to Beijing will be the first visit by a Canadian prime minister since 2017. This diplomatic effort is part of Canada’s strategy to diversify its trade relations beyond the U.S., including re-engaging with China after a period of strained ties exacerbated by the detainment of two Canadians by Beijing.
Furthermore, a recent public inquiry highlighted China as the most active foreign interference actor in Canada, exerting influence through proxies and diplomatic channels within the diaspora community. Nadjibulla views Carney’s visit as a crucial milestone in Canada-China relations, emphasizing the need for strategic decision-making to navigate potential risks and negotiations, including their impact on discussions with the U.S. to renew the Canada-U.S.-Mexico Agreement (CUSMA).
Canada’s imposition of 100% tariffs on Chinese electric vehicles aligns with the Biden administration’s trade measures to safeguard the North American auto industry. Nadjibulla suggests that dropping these tariffs could be a topic of discussion with the U.S., but she also mentions alternative strategies, such as applying specific tariffs based on subsidies received by Chinese carmakers or allowing local production of Chinese EVs or batteries.
Regarding other trade issues, Carney is expected to explore new agreements and partnerships during his visit, including discussions on canola and other agricultural products affected by China’s tariffs. The trip will also involve discussions on expanding Canada’s petroleum and liquefied natural gas markets, particularly in China.
While the visit is seen as a positive step by some, concerns remain about China’s intentions and the need for Canada to establish safeguards against foreign interference. Dennis Molinaro, a former national security analyst, emphasizes the importance of addressing potential risks before deepening engagement with China, advocating for the establishment of a foreign agency registry and foreign interference commissioner.
In conclusion, Carney’s visit to China is seen as a pivotal moment in recalibrating Canada-China relations and exploring new trade opportunities. Following his visit to China, Carney will continue his diplomatic efforts in Qatar to attract investments from the Middle East and then attend the World Economic Forum in Switzerland.