Canadian Prime Minister Mark Carney said on Sunday that Canada has no plans to seek a free trade agreement with China, following U.S. President Donald Trump’s threat to impose punitive tariffs on Ottawa.
Carney emphasized that Canada remains committed to its obligations under the Canada‑U.S.‑Mexico trade pact—CUSMA and will not seek a separate free trade deal without informing the other two partners.
“We have no intention of doing that with China or any other nonmarket economy,” Carney said. “What we have done with China is to rectify some issues that developed in the last couple of years.”
The prime minister stated that, under the free trade agreement with the U.S. and Mexico, Canada is obliged not to negotiate free trade deals with non-market economies without first notifying the other parties.
Carney’s remarks come after Trump’s warning to impose a 100% tariff on Canadian exports if Ottawa strikes a deal with Beijing. The statements come amid escalating tensions between the U.S. and Canada.
On January 16, Ottawa and Beijing reached a preliminary accord to reduce tariffs on certain goods. As part of the deal, Canada will permit an annual import of up to 49,000 Chinese electric vehicles at a reduced tariff rate of 6.1%, following the joint tariff hike to 100% in October 2024 alongside the United States.
In exchange, China will lower tariffs on Canadian agricultural exports, including canola seed oil, with tariffs set to decline from the current 85% to 15% beginning March 1.
In August 2025, Trump increased tariffs on Canadian goods from 25% to 35%. While most Canadian exports remain exempt under the CUSMA trade agreement, specific products—such as steel, copper, and certain automobiles and auto parts—continue to face U.S. duties.
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