BEIJING, China: Prime Minister Mark Carney announced that Canada will slash tariffs on electric vehicles as the country looks to forge new strategic ties with China.

Carney is the first Canadian prime minister to visit China since 2017, following months of diplomatic efforts. He is seeking to rebuild ties with his country's second-largest trading partner, after the United States.

Former Prime Minister Justin Trudeau had imposed a 100 percent tariff on Chinese electric vehicles in 2024, following similar U.S. penalties. In 2023, China exported 41,678 EVs to Canada.

Canada will initially allow up to 49,000 Chinese electric vehicles to enter on a 6.1 percent tariff under most-favoured-nation terms, Carney said after talks with Chinese leaders, including President Xi Jinping.

"This is a return to levels prior to recent trade frictions, but under an agreement that promises much more for Canadians," Carney told reporters. He later said the quota would gradually increase to about 70,000 vehicles in five years.

"For Canada to build its own competitive EV sector, we will need to learn from innovative partners, access their supply chains, and increase local demand," Carney said, turning away from Trudeau's rationale that tariffs were needed to protect domestic producers against subsidised Chinese manufacturers.

Relaxing electric-vehicle tariffs went against U.S. policy, and some members of President Donald Trump's cabinet criticised the move ahead of a planned review of the U.S.–Canada–Mexico trade deal. However, Trump himself voiced support for Carney, saying it was good for him to pursue a trade agreement with China.

Ontario Premier Doug Ford, whose province is Canada's main auto-manufacturing hub, condemned the deal. He said the federal government was allowing an influx of low-cost Chinese electric vehicles without firm guarantees of equal or immediate investment in Canada's economy, auto sector, or supply chains.

In response to earlier Canadian tariffs under former prime minister Justin Trudeau, China imposed tariffs in March on more than US$2.6 billion worth of Canadian farm and food products, including canola oil and meal, and later added tariffs on canola seed in August. As a result, China's imports of Canadian goods fell by 10.4 percent in 2025.

Under the new agreement, Carney said Canada expects China to reduce tariffs on canola seed to about 15 percent by March 1, down from the current 84 percent. He added that anti-discrimination tariffs on canola meal, lobsters, crabs, and peas are also expected to be lifted from March 1 until at least the end of the year. Carney said the deals could generate nearly $3 billion in export orders for Canadian farmers, fishers, and processors.

China's Commerce Ministry said it was adjusting anti-dumping measures on canola and anti-discrimination measures on some Canadian agricultural and seafood products in response to Canada lowering EV tariffs.

Carney also said Chinese President Xi Jinping had committed to visa-free travel for Canadians to China, though no details were provided. According to China's state-run Xinhua news agency, both countries agreed to restart high-level economic and financial talks, expand trade and investment, and strengthen cooperation in agriculture, oil, gas, and green energy.

Carney said Canada plans to double its energy grid over the next 15 years and sees opportunities for Chinese investment, including in offshore wind. He also said Canada is expanding liquefied natural gas exports to Asia and aims to produce 50 million tonnes of LNG annually by 2030, all for Asian markets.