economy

January 17, 2026

Canada and China slash tariffs on EVs and canola in reset of ties

Canada will allow imports of Chinese electric vehicles with a 6.1% tariff, Carney says.

Canada and China slash tariffs on EVs and canola in reset of ties

TL;DR

  • Canada and China have signed an initial trade deal to reduce tariffs on electric vehicles and canola.
  • The agreement allows for an initial quota of 49,000 Chinese electric vehicles at a 6.1% tariff, which will increase over five years.
  • China is expected to lower tariffs on Canadian canola seed by March 1 to approximately 15%.
  • Tariffs on Canadian canola meal, lobsters, crabs, and peas are also expected to be removed.
  • The deal is anticipated to unlock nearly $3 billion in export orders for Canadian businesses.
  • China's Commerce Ministry stated the adjustments are in response to Canada lowering EV tariffs.
  • Prime Minister Carney also mentioned a commitment from Xi Jinping for visa-free access for Canadians to China.
  • Both nations pledged to restart high-level economic and financial dialogue and enhance cooperation in various sectors.
  • The deal diverges from U.S. policy and has drawn criticism from some U.S. officials, though former President Trump expressed support.
  • Ontario Premier Doug Ford denounced the EV tariff reduction, citing concerns for Canada's auto sector.

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