Key Points
- Canadian Prime Minister Mark Carney said Canada will not pursue a free trade deal with China.
- The statement is a response to President Trump’s threat of a 100% tariff.
- Carney said his recent trip to China was about resolving specific trade issues, not a broad free trade agreement.
- The U.S. is still warning that tariffs are a possibility if Canada allows China to “dump goods.”
Canadian Prime Minister Mark Carney said on Sunday that his country has no intention of pursuing a free trade agreement with China, a direct response to President Trump’s threat to slap a 100% tariff on all Canadian goods.
“Canada respects its commitments and engagements under the United States-Mexico-Canada trade agreement, not to pursue free trade agreements with non-market economies,” Carney said.
The statement is a clear attempt to de-escalate a rapidly growing trade dispute between the two North American allies. On Saturday, Trump warned that he would impose massive tariffs on Canada if it struck a trade deal with China.
Carney explained that his recent trip to China was not about a free trade deal, but about fixing some specific “issues that had developed over the last couple of years.” He said the talks focused on EVs, agriculture, and fish products.
However, the Trump administration is still keeping the pressure on. U.S. Treasury Secretary Scott Bessent said on Sunday that the 100% tariff is still a possibility “if they go further, if we see that Canadians are allowing the Chinese to dump goods.”
The Chinese embassy in Canada, for its part, said it is ready to work with Canada to “advance the China-Canada strategic partnership.”
This whole episode highlights the delicate balancing act Canada faces as it navigates the growing rivalry between its two biggest trading partners. For now, it seems Ottawa has decided that keeping the peace with Washington is the top priority.
