 | Source: Politico |
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The relation between China and Canada is tough. Through history, it has had its highs and lows. On the one hand, it is shaped by economic ties and cooperation. But on the other, there is also security issues and deep mistrust. |
In the meantime, Canada's ties with the U.S. have been weakening. It makes its position between China and the US more uncertain. It also increases the need to diversify its partnerships. |
A period of heightened tensions |
Throughout history, China and Canada have had many ups and downs. But since the late 2010s, relations have declined. First there was the arrest of Huawei executive Meng Wanzhou in Canada in 2018. Then followed by the detention of two Canadian citizens in China. These events damaged trust. Although all were released, the impact remains strong. For many in Canada, China is now seen less as a partner and more as a strategic risk. Canada has also been critic on China's actions. These include the oppression of Uyghurs, the crackdown on dissent in Hong Kong and unfair trade practices. |
Security issues play a big part. Canada sees China as an active actor on political meddling. China is said to have been taking part in election meddling, pressure on communities, and cyber activities. As a result, Canada has tightened its laws. It was mostly the case for foreign influence and intel cooperation. But also, for national security screening. |
The ban on Huawei and ZTE from Canada's 5G networks is another key symbol of this shift. It aligned Canada with other allies. But it also further angered China. China saw this ban as discriminatory. But Canada said it was crucial to national security. |
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The weakening Canada–US relationship changes the equation |
Canada's China policy has been linked to its alliance with the U.S. But Canada–US relations are under strain. This is due to: |
- trade disputes, |
- protectionist US policies, |
- political uncertainty in the U.S. |
Canada has faced US tariffs, pressure on defense spending, and unpredictable diplomatic behavior. Canada's confidence in the U.S. took a hit. There are worries whether the U.S. will always act as a reliable partner. So, Canada is trying to gain more autonomy. This includes how it manages its relations with China. |
This shift puts Canada in a tough position. On one hand, Canada still depends on the US for security, intel, and trade. On the other hand, Canada wants to avoid being forced into a rigid US-led confrontation with China. This could harm its own interests. |
Canada and China reconnecting in 2026 |
In January, Carney traveled to China and met with Xi Jinping. The goal was to reset ties after nearly a decade of tensions. During their talks, both leaders agreed to create a new strategic partnership. They agreed to revive high-level talks on economic issues. They signed an Economic and Trade Cooperation Roadmap. This shows a shift from opposition toward managed cooperation. |
One of the key outcomes was a series of trade concessions. China agreed to lower tariffs on Canada's agricultural exports. Canada agreed to lower tariffs on China's electric vehicles. They will also extend their cooperation in sectors such as: |
· Energy |
· Clean technology |
· Agriculture |
· Law enforcement |
· Finance |
· People-to-people exchanges |
These outcomes reflect Canada's strategy to diversify its partnerships. But security and human rights are still sensitive subjects. |
Economic ties |
China was one of Canada's top exports for agriculture. Its canola and canola products exported to China valued at about CAD 5 billion. But China imposed punitive tariffs. They included duties near 75.8 % on canola seed. Plus, a broader 100 % tariff on other food exports. This caused canola shipments to tumble. They briefly reached very low levels as Chinese buyers paused purchases. It was the first such drop in about 20 years. |
Trade data from last year shows that their total merchandise trade reached about CAD 28.8 billion by Q3. This was a 10.5 % drop from Q2. Imports from China fell sharply. But Canada's exports stayed stable at about CAD 7.8 billion. |
 | Canada–China Bilateral Trade, 2024 Q1–2025 Q3 (Source: Canada-China Business Council) |
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 | Canadian Exports to China, 2024 Q1–2025 Q3 (Source: Canada-China Business Council) |
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 | Canadian Imports from China, 2024 Q1–2025 Q3 (Source: Canada-China Business Council) |
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Despite these setbacks, recent talks led to the trade deal. It aims at reducing economic friction. China agreed to lower tariffs on canola seed to about 15 %, down from tariff levels near 85 %. Canada moved to reduce tariffs on Chinese electric vehicles from 100 % to around 6.1 %. Plus, an annual quota initially capped at about 49 thousand units, rising to 70 thousand over five years. This is part of a broader deal to ease trade tensions and encourage investment. China has also been a market for Canada's beef and seafood. A ban on Canadian beef has been lifted in January. |
These shifts show a cautious reopening. But trade is still fragile and subject to policy changes. This relation continues to be a key source of export revenue for parts of Canada's economy. But political and security tensions may still shape trade decisions. |
Decoding geopolitics isn't a job. It's survival. |
Joy |
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