China, Canada Sign New Trade Roadmap, Cut EV and Farm Tariffs

Canadian Prime Minister Mark Carney has paid an official visit to China at the invitation of the Chinese government, during which the two sides reached broad consensus on deepening bilateral economic and trade cooperation. The visit resulted in the signing of the China–Canada Economic and Trade Cooperation Roadmap, establishing preliminary joint arrangements for addressing bilateral trade issues, including new adjustments to tariffs on electric vehicles (EVs) and agricultural products.

Canada to Cut Tariffs on Chinese Electric Vehicles

According to reports by Agence France-Presse, The New York Times, and other international media on January 16, Prime Minister Carney announced while in China that Canada will lower tariffs on certain Chinese electric vehicles. Under the new arrangement, up to 49,000 Chinese-made EVs will be allowed to enter the Canadian market at a most-favored-nation (MFN) tariff rate of 6.1%, restoring tariff levels to those in place before the trade frictions of recent years.

China's Ministry of Commerce later confirmed the consultation outcomes, stating that Canada will grant China an annual quota of 49,000 EVs. Vehicles imported within this quota will be subject to the 6.1% MFN tariff rate and exempt from the previous 100% additional tariff. The quota is set to increase annually at a specified rate.

Canadian officials noted that the quota corresponds to China's EV export volume to Canada prior to the 2023–2024 trade frictions and represents less than 3% of Canada's new vehicle market.

Carney also revealed plans to deepen cooperation with China in clean energy storage and manufacturing, with the aim of attracting additional investment. He said that over the next three years, the agreement is expected to drive substantial Chinese investment into Canada's automotive sector, create high-quality jobs, and accelerate Canada's progress toward its net-zero emissions goals. He added that building a competitive domestic EV industry requires learning from innovative partners, integrating into global supply chains, and expanding domestic market demand.

Adjustments to Tariffs on Canadian Agricultural Imports

Agricultural trade adjustments were another key focus of the visit. Carney stated that China is expected to reduce the overall tariff on Canadian canola to around 15% before March this year. In addition, Canadian canola meal, lobster, crab, and pea products are expected to be free from Chinese countermeasures from March until at least the end of the year.

Canadian media reported that the adjustments will help farmers plan ahead for the upcoming planting season. Carney also mentioned that China plans to introduce visa-free entry for Canadian citizens, although Chinese authorities have not yet publicly confirmed this policy.

Despite the lack of official confirmation, Carney expressed optimism that the agreements could unlock nearly USD 3 billion in export orders as Canadian farmers, fishers, and processors further tap into the Chinese market. He noted that China was once Canada's largest export destination for canola, adding that the objective is not only to restore previous export levels but to surpass them. He said the agreements reflect a renewed partnership for a new era, with potential cooperation expanding to grains, pulses, lobster, pork, pet food, and other product categories.

China and Canada Renew RMB 200 Billion Currency Swap Agreement

On January 16, the People's Bank of China (PBOC) announced on its official website that China and Canada have renewed their bilateral local currency swap agreement. With approval from China's State Council, the PBOC and the Bank of Canada agreed to extend the swap arrangement with a scale of RMB 200 billion and a validity period of five years, which may be renewed by mutual consent.

The PBOC stated that the renewed swap agreement will help strengthen financial cooperation between the two countries, expand the use of local currencies in bilateral transactions, facilitate trade and investment, and contribute to financial stability.