On August 26, the Canadian government announced the imposition of significant tariffs on electric vehicles (EVs), steel, and aluminum imported from China. Starting October 1, Canada will apply a 100 percent surtax on all Chinese-made EVs, including electric and certain hybrid passenger automobiles, trucks, buses, and delivery vans. Additionally, from October 15, a 25 percent surtax will be levied on imports of steel and aluminum products from China.
Alignment with U.S. Trade Policies
This move signals Canada’s alignment with the United States on trade policies concerning China. In May of this year, U.S. President Joe Biden announced a 100 percent tariff on Chinese-made electric vehicles. Shortly before Canada’s announcement, Prime Minister Justin Trudeau met with U.S. National Security Advisor Jake Sullivan on August 25. Following their meeting, Canada unveiled its decision to impose these high tariffs.
According to reports by the Associated Press, Sullivan “encouraged” the Canadian government to take this step during their discussion. Sullivan stated, “The U.S. does believe that a united front, a coordinated approach on these issues benefits all of us.” Prime Minister Trudeau responded, “We’re doing it in alignment, in parallel, with other economies around the world that recognize that this is a challenge that we are all facing. Unless we all want to get to a race to the bottom, we have to stand up.”
Protecting Domestic Industries
Canada’s Deputy Prime Minister and Finance Minister Chrystia Freeland echoed this sentiment, saying, “China has an intentional state-directed policy of overcapacity and oversupply designed to cripple our own industry. We simply will not allow that to happen to our EV sector, which has shown such promise.”
While Canada maintains that it pursues an independent trade policy, these actions suggest a closer alignment with U.S. strategies under the guise of promoting “fairness.” The rapid growth of China’s electric vehicle industry has positioned it as a significant player in the global market. Official data shows that in 2023, China sold 9.495 million new-energy vehicles (NEVs), accounting for over 60 percent of global NEV sales.
Implications for Global Trade
Canada’s decision to impose steep tariffs may have broader implications for global trade dynamics. By aligning with U.S. policies, Canada joins a united front that could impact international supply chains and market competition. The move raises questions about the future of trade relations between Canada and China, as well as the potential effects on global investors, businesses, and consumers.
As trade tensions continue to evolve, stakeholders across various sectors will be watching closely. The tariffs not only affect the importation of goods but also signal a shift in geopolitical alliances and economic strategies. How these changes will influence global markets and the Asian economic landscape remains to be seen.
Reference(s):
cgtn.com
