China yesterday announced tariffs on more than US$2.6 billion worth of Canadian agricultural and food products, retaliating against levies Ottawa introduced in October last year and opening a new front in a trade war largely driven by US President Donald Trump’s tariff threats.
The levies, announced by the Chinese Ministry of Commerce and scheduled to take effect on March 20, match the 100 percent and 25 percent import duties Canada slapped on China-made electric vehicles and steel and aluminum products just more than four months ago.
By excluding canola — which is also known as rapeseed, and was one of Canada’s top exports to the world’s No.1 agricultural importer prior to China investigating it for anti-dumping last year — Beijing might be keeping the door open for trade talks.
Photo: Reuters
However, the tariffs also serve as a warning shot, analysts said, with the Trump administration having signaled it could ease 25 percent import levies the White House is threatening Canada and Mexico with if they apply the same extra 20 percent duty he has slapped on Chinese goods over fentanyl flows.
“Canada’s measures seriously violate World Trade Organization rules, constitute a typical act of protectionism and are discriminatory measures that severely harm China’s legitimate rights and interests,” China’s commerce ministry said in a statement.
China would apply a 100 percent tariff to more than US$1 billion of Canadian rapeseed oil, oil cakes and pea imports, and a 25 percent duty on US$1.6 billion worth of Canadian aquatic products and pork.
“The timing may serve as a warning shot,” said Dan Wang (王丹), China director at Eurasia Group in Singapore. “By striking now, China reminds Canada of the cost of aligning too closely with American trade policy.”
“China’s delayed response [to Ottawa’s October tariffs] likely reflects both capacity constraints and strategic signaling,” she said. “The commerce ministry is stretched thin, juggling trade disputes with the US and European Union.”
“Canada, a lower priority, had to wait its turn,” she added.
Canadian Prime Minister Justin Trudeau in August last year said that Ottawa was imposing the levies to counter what he called China’s intentional state-directed policy of overcapacity, following the lead of the US and the EU, both of which have also applied import levies on Chinese-made electric vehicles.
In response, China in September last year launched an anti-dumping investigation into Canadian canola imports. More than half of Canada’s canola exports go to China and the trade was worth US$3.7 billion in 2023, the Canola Council of Canada said.
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