Canada drops tariffs on 49,000 annual Chinese EV imports

Prime Minister Mark Carney announced the move following his meetings with China’s leaders in Beijing.

Hong Kong port — *China is partially removing its tariffs on Chinese EVs. – Photo by Ana Benet on Pexels.com*

Electric vehicles made in China are poised to start flowing into Canada once again, but in limited numbers.

Prime Minister Mark Carney announced a bilateral trade agreement with China on Friday, Jan. 16 following his meetings with China’s leaders in Beijing. He met with China’s President Xi Jinping, Premier Li Qiang, and Zhao Leji, the chairman of the Standing Committee of the National People’s Congress of China.

Canada will drop its 100 per cent tariff on up to 49,000 Chinese EVs per year, bringing the rate down to Canada’s typical most-favoured-nation (MFN) tariff rate of 6.1 per cent. Chinese EVs arriving beyond that number would still be subject to tariffs of 106.1 per cent.

The Canadian government said 49,000 is how how many such vehicles were imported from China in the last year before Canada introduced its 100 per cent tariffs simultaneously with the United States.

The government also said 49,000 represents less than three per cent of Canada’s automotive market.

What does Canada get in return?

Canada is expecting China to lower its counter-tariffs on our agricultural products.

The federal government expects China will lower its tariffs on Canadian canola seed to a combined rate of 15 per cent, down from the current 85 per cent, by March 1.

The government also expects Canadian canola meal, lobsters, crabs and peas will not be subject to relevant anti-discrimination tariffs from March 1 to the end of this year.

Ottawa expects this will unlock nearly $3 billion in export orders from Canada, thus supporting businesses and jobs.

The two governments also said they will explore further opportunities, including increasing two-way investment in clean energy and technology, agri-food, wood products, and other sectors.

“At its best, the Canada-China relationship has created massive opportunities for both our peoples. By leveraging our strengths and focusing on trade, energy, agri-food, and areas where we can make huge gains, we are forging a new strategic partnership that builds on the best of our past, reflects the world as it is today, and benefits the people of both our nations,” Carney said in a news release.