Canada rejects China free-trade deal as Trump threatens tariffs

Canadian Prime Minister Mark Carney says Canada will not pursue a free-trade agreement with China, arguing the Beijing deal only fixes a few tariff issues. Trump has threatened a 100% tariff on Canadian goods if Canada signs a China deal. Canada previously imposed 100% tariffs on Chinese EVs and 25% on steel and aluminum, but recently lowered EV tariffs and set an initial cap on Chinese EV imports (49,000 vehicles per year at 6.1%, rising toward 70,000 per year over five years) in exchange for Chinese investment in Canada’s auto industry, while reaffirming USMCA commitments not to pursue non-market-economy deals.