Breaking Barriers: Canada and China Cut Tariffs in Historic Meeting

Sat Jan 17 2026 05:28:11 GMT+0200 (Eastern European Standard Time)

Canada's Prime Minister Mark Carney and China's Xi Jinping shake hands on a new trade agreement that reduces tariffs and aims to repair strained relations between the two countries.

In a significant development for international trade, Canada and China have reached an agreement to lower tariffs on key goods. Following a high-stakes meeting in Beijing, PM Mark Carney and President Xi Jinping announced that Canada would cut tariffs on Canadian canola oil, while China will reduce levies on electric vehicles imported into Canada. This breakthrough is seen as a major reset in relations after years of tension. Both leaders emphasized the importance of fostering a sustainable partnership amidst global economic changes.

Chinese leader Xi Jinping and Canadian PM Mark Carney have announced lower tariffs, signalling a reset in their countries' relationship after a key meeting in Beijing.

China is expected to lower levies on Canadian canola oil from 85% to 15% by 1 March, while Ottawa has agreed to tax Chinese electric vehicles at the most-favoured-nation rate of 6.1%, Carney told reporters.

The deal is a breakthrough after years of strained ties and tit-for-tat levies. Xi hailed the 'turnaround' in their relationship but it is also a win for Carney, the first Canadian leader to visit China in nearly a decade.

He has been trying to diversify Canadian trade away from the US, his country's largest trading partner, following the uncertainty caused by Trump's tariffs.

The deal could also see more Chinese investments in Canada, right on America's doorstep.

Carney referenced the impact of Trump's tariffs, suggesting they’ve pushed Canada closer to its largest rival, China.

Carney remarked that Canada’s ties to China had grown more predictable lately, praising the talks with Beijing as realistic and respectful.

However, he made clear that Ottawa does not agree with Beijing on everything, including human rights and election interference, highlighting Canada’s 'red lines' in discussions with Xi.

Observers believe Carney's visit could set an example for other countries also feeling the effects of Washington's tariffs.

As China asserts itself as a stable global partner, the world is watching closely the unfolding dynamics between Canada and China, especially with other world leaders planning visits to Beijing soon.

Earlier in his visit, Carney indicated that the Canada-China partnership is positioning both countries towards a potential 'new world order'.

With hopes for continued peaceful relations, Xi stated that the healthy development of China-Canada relations would foster global peace and prosperity.