Finance Minister Chrystia Freeland rises during Question Period in the House of Commons on Parliament Hill in Ottawa on Nov. 28, 2023. (Screenshot from ParlVu)
By Andrew Chen
As the federal government considers tariffs on Chinese electric vehicles, Finance Minister Chrystia Freeland criticized the regime’s state-directed oversupply tactics, labelling them as a manifestation of the communist regime’s “Leninist precept.”
On July 2, the Liberal government launched a 30-day public consultation on imposing tariffs on China. This move came in response to what the government described as “unfair trade practices” by China, saying the regime is intentionally flooding the global market with Chinese-made electric vehicles (EVs), which hurt Canadian manufacturers and auto workers.
In a July 12 interview with Bloomberg, Ms. Freeland hinted at an expansion of the potential tariffs on Chinese EVs, noting that China’s “state-directed policy of overcapacity” is part of its centrally planned communist economy.
“I see that Leninist precept in Chinese economic policy—of dominating the commanding heights of the global economy and of acting quite intentionally to undermine and cut out Western competitors,” she said. “I think it’s high time for us to be clear-eyed about that.”
The Chinese Communist Party (CCP) has implemented a centrally-planned economic system since assuming power over mainland China in 1949 following the Chinese Civil War. Unlike market-oriented mechanisms, this system enforces control over prices and central resource allocation.
Despite major economic reforms in the 1970s that introduced elements of market-oriented policies, the CCP retained a strong presence in strategic sectors of the economy. This included implementing strategic planning, enforcing regulatory measures, utilizing state-owned enterprises, and maintaining control over private companies in key industries through embedded party branches.
Ottawa’s public consultation comes after the United States and the European Union took measures to curb Chinese oversupply.
U.S. President Joe Biden has ordered a quadrupling of the tariff rate on EVs imported from China, increasing it from the current 25 percent to 100 percent, effective on Aug. 1. Significant tariffs are also imposed on other Chinese imports, including steel and aluminum, semiconductors, solar cells, batteries, and critical minerals.
Similarly, earlier this month, the EU announced a tariff of up to 37.6 percent on Chinese-made EVs, to be imposed by all member states. In a July 4 statement, the European Commission also condemned China for benefiting from unfair subsidization, saying it is causing a threat of economic injury to EU producers.