China Proposes a Tariff-Drop Swap With Canada

The Chinese Ambassador recently told a Canadian national television audience that his country is willing to remove its tariffs on Canada’s pork products, seafood, and, by far the largest of the categories, canola oil, seed, and meal - if Canada drops its 100 percent tariff on Chinese electric vehicles.  The Chinese ambassador to Canada, Wang Di, spoke through a translator to deliver Beijing’s message.

“If the EV tariffs are removed, then China will also remove the tariffs on the relevant products of Canada.”

Canada placed a 100% tariff on all EVs imported from China one year ago, immediately on the heels of the United States’ imposition of the same tariff level.  That move was aimed at protecting the North American auto manufacturing sector and was in response to concerns over Chinese technology threats.

In retaliation, China levied tariffs against the Canadian agriculture sector. And over the past year, Saskatchewan, Canada’s largest canola-growing province, has seen its exports shrink by more than 75 percent in the wake of losing China, its single largest customer.

Canada Has Not Benefited Following Trump's Lead

Guy Saint-Jaque, the former Canadian ambassador to China, thinks this opening by the Chinese ambassador gives Ottawa a reason to take another look at the Chinese tariff file.  Saint-Jaque says there has been no tangible benefit over this issue from the Trump administration.

“Ottawa decided to put these tariffs in place to be in line with Washington. We didn’t get any brownie points for that, and I think it would be normal for Ottawa to revisit.”

Prime Minister Mark Carney said that his office is taking a fresh look at the issue.

“We have begun more intense engagement with China with respect, first and foremost, to canola and other agricultural products. It’s too early to come to any conclusions on this.”

The Canadian auto manufacturing sector wasted no time in telling the Prime Minister’s office that any move to cancel the existing tariffs against Chinese electric vehicles would only put another nail in the coffin of their industry, currently under the restraining American tariff actions.

Canadian Farmers Want Market Access

The president and CEO of the Canadian Canola Growers Association said he has no desire to get into a debate with the automotive sector. Rick White believes that it is a job for the politicians. White says he just wants to get the Chinese market reopened for his industry and for Canada’s canola growers.

“What’s going to be on the table is up to our elected officials. Since these tariffs have come on, no canola has been going to China, whether it’s seed, oil, or meal," White said.  "We know this is a political problem, and it’s going to take a political fix. We just want to see results and get back to free and open trade with China.”

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