Recently, at the invitation of the Chinese Government, Canadian Prime Minister Mark Carney paid an official visit to China. The two sides reached broad consensus on deepening economic and trade cooperation, signed the "China-Canada Economic and Trade Cooperation Roadmap", and produced an initial joint arrangement on handling bilateral economic and trade issues, including two new adjustments to import tariffs on electric vehicles and agricultural products.

   EV tariff cut to 6.1 per cent   

       Multiple international outlets including AFP and The New York Times reported on 16 January that, while on an official visit to China, Canadian Prime Minister Mark Carney announced that Ottawa will lower some of its tariffs on Chinese-made electric vehicles. Up to 49,000 EVs a year will be allowed into Canada at the Most-Favoured-Nation rate of 6.1 per cent—returning to the pre-trade-friction level—instead of the current 100 per cent surtax.

Moments later China’s Ministry of Commerce released the agreed text:

• Annual quota: 49,000 Chinese EVs at 6.1 per cent MFN duty

• Quota to rise each year by an agreed percentage

• No additional 100 per cent surtax inside the quota

      Ottawa says the 49,000-unit ceiling matches pre-dispute export volumes (2023-2024) and represents “less than 3 per cent of Canada’s new-car market.”

      Carney also revealed plans to deepen clean-energy storage and production co-operation with Beijing to attract more investment. “Over the next three years this deal is expected to trigger large-scale Chinese investment in Canada’s auto sector, create high-quality Canadian jobs and accelerate our path to net-zero,” he told reporters.

   Canola tariff cut to ~15%   

       Agriculture grabbed equal spotlight. Carney said Beijing will cut the combined tariff on Canadian canola to about 15 per cent by March and, from March through at least year-end, Canadian canola meal, lobster, crab and pea products will no longer be subject to Chinese counter-measures.

       Canadian media noted the move will let farmers plan spring planting. Carney added that China will grant visa-free entry to Canadian citizens, although Beijing has not yet confirmed this publicly. He remains upbeat, estimating the package could unlock almost USD 3 billion in export orders for Canadian farmers, fishers and processors.

     “China was once our largest canola market,” Carney said. “Our goal is not only to restore past volumes but to exceed them.” He said the agreement embodies “a new partnership for a new era” and could be expanded to grains, pulses, pork and pet food.

   BoC-PBoC swap renewed   

       On the same day, the People’s Bank of China announced that the two central banks have renewed their bilateral local-currency swap line. Approved by the State Council, the PBoC and the Bank of Canada (Canada’s central bank) rolled over the facility for RMB 200 billion (roughly CAD 40 billion) for five years, extendable by mutual consent.

       The PBoC said the renewal will strengthen financial co-operation, promote wider use of the two currencies, facilitate bilateral trade and investment, and safeguard financial stability.