Chinese President Xi Jinping and Canadian Prime Minister Mark Carney have agreed to roll back key tariffs, signalling a tentative reset in bilateral ties after high-level talks in Beijing, following years of diplomatic and trade friction.
China will cut tariffs on Canadian canola oil from 85 percent to 15 percent by March 1, while Canada has agreed to tax Chinese electric vehicles at the most-favoured-nation rate of 6.1 percent, Carney told reporters after the meeting. The announcement marks a breakthrough after prolonged tit-for-tat trade measures that had strained relations between the two countries.
Xi described the agreement as a “turnaround” in China-Canada ties, while for Carney it was a significant diplomatic moment, becoming the first Canadian prime minister to visit China in nearly a decade. The visit comes as Ottawa seeks to diversify trade away from the US, Canada’s largest trading partner, amid uncertainty created by US President Donald Trump’s on-again, off-again tariff policies.
Carney appeared to acknowledge that US trade actions had helped push one of Washington’s closest allies towards closer engagement with Beijing. He said Canada’s relationship with China had become more “predictable” in recent months and described talks in Beijing as “realistic and respectful”.
At the same time, Carney stressed that the reset did not mean alignment on all issues. He said he had clearly outlined Canada’s “red lines” to Xi, including concerns over human rights, election interference and the need for firm “guardrails” in the relationship.
Observers see the visit as a possible template for other countries grappling with the fallout from US trade policies. In contrast to Washington’s unpredictability, Xi has been positioning China as a stable global partner, promoting what Beijing calls “win-win” cooperation. Recent visits to China by leaders from South Korea and Ireland, with more expected from the UK and Germany, suggest the strategy may be gaining traction.
Trade has been a central point of contention. In 2024, Canada imposed 100 percent tariffs on Chinese electric vehicles, mirroring US measures. China responded by slapping tariffs on more than $2 billion worth of Canadian farm and food products, including canola, leading to a 10 percent fall in Chinese imports of Canadian goods in 2025.
China is Canada’s second-largest trading partner, with bilateral merchandise trade of more than C$118 billion in 2024, well behind trade with the US, which exceeded $761 billion. Still, Carney has argued that closer economic engagement with China is vital as Canada seeks a more competitive and independent economy amid global trade disruption.
During his three-day visit, Carney also met senior Chinese business leaders and oversaw the signing of several energy and trade cooperation agreements, underlining what both sides described as a more pragmatic, if cautious, new phase in relations.
