Canada announced on Monday that it will impose a 100% tariff on imports of Chinese-made electric vehicles, in response to what Western governments see as unfair subsidies benefiting China’s industry. This decision was influenced by U.S. national security adviser Jake Sullivan during a meeting with Canadian Prime Minister Justin Trudeau. Canada will also implement a 25% tariff on Chinese steel and aluminum.
The move comes after President Joe Biden imposed tariffs on Chinese electric vehicles, batteries, solar cells, steel, aluminum, and medical equipment. Trudeau stated that China has given itself an unfair advantage in the global marketplace. Canadian officials expressed concerns about China’s intentional overcapacity and oversupply policy, which they believe could harm the Canadian EV sector.
Chinese brands are not yet prominent in the Canadian market, but Chinese EV giant BYD has signaled its intention to enter the market next year. Canada also plans to hold consultations on possible tariffs on Chinese batteries, battery parts, semiconductors, critical minerals, metals, and solar panels. The country may face retaliation from China in other industries, with barley and pork being potential targets.
Canada’s decision was influenced by its economic ties with the U.S., with more than 75% of its exports going to the U.S. Former Canadian ambassador to China, Guy Saint-Jacques, stated that China is likely to send a message through retaliatory measures in other industries.
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