Canada’s prime minister struck a deal with China on Friday.
The country will lower tariffs on Chinese EVs in exchange for China lifting tariffs on Canadian canola and other agricultural products. Up to 49,000 Chinese EVs can enter Canada under a tariff rate of 6.1 percent.
The remaining Chinese electric vehicles, beyond the first 49,000, will still face 100 percent tariffs. China is expected to lower tariffs on Canola seeds from 80 percent to 15 percent. Tariffs on Canadian lobsters, crabs, and peas are also expected to be put on hold this year.
Prime Minister Mark Carney says China would make a considerable investment in Canada’s auto sector within three years.
It comes as Carney looks to diversify trade away from the United States following President Donald Trump’s tariff hikes.
Meanwhile, Ontario’s premier criticized Carney’s deal with China, warning it could threaten Ontario’s auto industry.
The premier added that it could affect Canada’s access to American markets if the United States sees Canada as a backdoor for cheap Chinese imports.