Carney says Canada has no plans to pursue free trade agreement with
China as Trump threatens tariffs
[January 26, 2026] By
ROB GILLIES
TORONTO (AP) — Canadian Prime Minister Mark Carney said Sunday his
country has no intention of pursuing a free trade deal with China. He
was responding to U.S. President Donald Trump’s threat to impose a 100%
tariff on goods imported from Canada if America’s northern neighbor went
ahead with a trade deal with Beijing.
Carney said his recent agreement with China merely cuts tariffs on a few
sectors that were recently hit with tariffs.
Trump claims otherwise, posting that “China is successfully and
completely taking over the once Great Country of Canada. So sad to see
it happen. I only hope they leave Ice Hockey alone! President DJT”
The prime minister said under the free trade agreement with the U.S. and
Mexico there are commitments not to pursue free trade agreements with
nonmarket economies without prior notification.
“We have no intention of doing that with China or any other nonmarket
economy,” Carney said. “What we have done with China is to rectify some
issues that developed in the last couple of years.”
In 2024, Canada mirrored the United States by putting a 100% tariff on
electric vehicles from Beijing and a 25% tariff on steel and aluminum.
China had responded by imposing 100% import taxes on Canadian canola oil
and meal and 25% on pork and seafood.
Breaking with the United States this month during a visit to China,
Carney cut its 100% tariff on Chinese electric cars in return for lower
tariffs on those Canadian products.
Carney has said there would be an initial annual cap of 49,000 vehicles
on Chinese EV exports coming into Canada at a tariff rate of 6.1%,
growing to about 70,000 over five years. He noted there was no cap
before 2024. He also has said the initial cap on Chinese EV imports was
about 3% of the 1.8 million vehicles sold in Canada annually and that,
in exchange, China is expected to begin investing in the Canadian auto
industry within three years.
Trump posted a video Sunday in which the chief executive of the Canadian
Vehicle Manufacturers’ Association warns there will be no Canadian auto
industry without U.S. access, while noting the Canadian market alone is
too small to justify large scale manufacturing from China.
“A MUST WATCH. Canada is systematically destroying itself. The China
deal is a disaster for them. Will go down as one of the worst deals, of
any kind, in history. All their businesses are moving to the USA. I want
to see Canada SURVIVE AND THRIVE! President DJT," Trump posted on social
media.
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This combination of images shows Canada's Prime Minister Mark Carney
on June 16, 2025, in Kananaskis, Canada, left, and President Donald
Trump on Oct. 7, 2025, in Washington. (AP Photo/Mark Schiefelbein,
left, Jacquelyn Martin)
 Trump's post on Saturday said that
if Carney “thinks he is going to make Canada a ‘Drop Off Port’ for
China to send goods and products into the United States, he is
sorely mistaken.”
“We can’t let Canada become an opening that the
Chinese pour their cheap goods into the U.S,” U.S. Treasury
Secretary Scott Bessent said on ABC’s “This Week.”
“We have a (United States–Mexico–Canada Agreement), but based off --
based on that, which is going to be renegotiated this summer, and
I’m not sure what Prime Minister Carney is doing here, other than
trying to virtue-signal to his globalist friends at Davos.”
Trump’s threat came amid an escalating war of words with Carney as
the Republican president’s push to acquire Greenland strained the
NATO alliance.
Carney has emerged as a leader of a movement for countries to find
ways to link up and counter the U.S. under Trump. Speaking in Davos
before Trump, Carney said, “Middle powers must act together because
if you are not at the table, you are on the menu” and he warned
about coercion by great powers — without mentioning Trump’s name.
The prime minister received widespread praise and attention for his
remarks, upstaging Trump at the World Economic Forum.
Trump’s push to acquire Greenland has come after he has repeatedly
needled Canada over its sovereignty and suggested it also be
absorbed into the United States as a 51st state. He posted an
altered image on social media this week showing a map of the United
States that included Canada, Venezuela, Greenland and Cuba as part
of its territory.
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