Carney reaffirms Canada won’t strike China free trade pact under USMCA rules

Prime Minister Mark Carney said on Sunday that Canada will not be signing any free trade agreement with China. His statement was a direct response to President Donald Trump, who threatened to hit Canada with a 100% tariff on all imported goods if Carney moved forward with any deal involving Beijing.

“This isn’t a free trade agreement,” Carney said. “It’s just correcting a few tariff problems we’ve had with China the past couple of years.”

Trump doesn’t agree. He jumped online and wrote, “China is successfully and completely taking over the once Great Country of Canada. So sad to see it happen. I only hope they leave Ice Hockey alone! President DJT.”

Trump lashes out as Canada adjusts China tariffs

Carney explained that under the USMCA, no country is allowed to make free trade deals with “nonmarket economies” like China without notifying the others. “We have no intention of doing that with China or any other nonmarket economy,” he said. “What we’ve done is clean up some of the mess from the past couple of years.”

In 2024, Canada followed the U.S. by slapping a 100% tariff on electric vehicles from China, and a 25% tariff on steel and aluminum.Beijing fired back with their own 100% import taxes on Canadian canola oil and meal, and 25% on pork and seafood.

Carney’s new adjustment drops tariffs on some of those goods, but he insisted it was not a full-blown trade deal.

There’s now a cap: China can export up to 49,000 EVs per year into Canada at a 6.1% tariff.That number will increase to about 70,000 in five years.Before 2024, there was no limit.

Carney pointed out that 49,000 is only 3% of the 1.8 million vehicles sold in Canada every year. And in return, China is expected to invest in the Canadian auto industry within three years.

Trump wasn’t done.

On Sunday, he posted a video showing the head of the Canadian Vehicle Manufacturers’ Association warning that the auto sector won’t survive without access to the U.S. The executive said the Canadian market isn’t big enough to support large-scale production from China.

Trump wrote, “A MUST WATCH. Canada is systematically destroying itself. The China deal is a disaster for them. Will go down as one of the worst deals, of any kind, in history. All their businesses are moving to the USA. I want to see Canada SURVIVE AND THRIVE! President DJT.”

Washington accuses Canada of helping China bypass tariffs

On Saturday, Trump wrote, “If Carney thinks he is going to make Canada a ‘Drop Off Port’ for China to send goods and products into the United States, he is sorely mistaken.”

Treasury Secretary Scott Bessent also went after Carney, saying, “We can’t let Canada become an opening that the Chinese pour their cheap goods into the U.S.”

He said the USMCA (which will be renegotiated this summer) doesn’t allow this kind of behavior. “I’m not sure what Prime Minister Carney is doing here, other than trying to virtue-signal to his globalist friends at Davos,” Bessent added.

This fight is only the latest in a long list of Trump’s clashes with Canada. The 47th president’s push to buy Greenland has already put a strain on the NATO alliance, and his public jabs at Canada’s sovereignty haven’t helped.

Trump has floated the idea of making Canada the 51st state. Just this week, he posted a fake map showing the U.S. absorbing Canada, Greenland, Venezuela, and Cuba.

Carney, for his part, has become a voice for countries looking to push back against U.S. pressure. Speaking in Davos before Trump arrived, Carney said, “Middle powers must act together because if you are not at the table, you are on the menu.” He didn’t name Trump, but everyone knew who he was talking about. His speech got a ton of media attention, stealing the spotlight from Trump at the World Economic Forum.

But even with the backlash, Carney is standing firm. “We are not doing a free trade deal with China,” he repeated. “We are just fixing problems.”

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