Canada says recent China dealings are entirely consistent with CUSMA

Prime Minister Mark Carney said Ottawa’s recent trade steps with China comply with CUSMA, and Canada has cut its tariff on Chinese-made electric vehicles to 6.1% with an annual cap of 49,000 vehicles.

Prime Minister Mark Carney said Ottawa's recent dealings with Beijing are entirely consistent with Canada's obligations under the continental trade pact with the United States and Mexico, known as CUSMA. He noted that under CUSMA Canada cannot pursue free trade agreements with non-market economies without prior notification. Canada recently agreed to reduce its 100 per cent tariff on Chinese-made electric vehicles to 6.1 per cent with an annual cap of 49,000 vehicles. The tariff change is linked to an expectation that China will lower most of its retaliatory tariffs on Canadian agricultural products. Key points: - Carney said Canada's actions follow CUSMA and that Canada has no intention of pursuing a free trade agreement with China or other non-market economies without prior notice. - Canada committed to cut its tariff on Chinese-made electric vehicles to 6.1% and set an annual cap of 49,000 vehicles. - China is expected to reduce most retaliatory tariffs on Canadian agricultural exports, including lobster, crab and canola. - U.S. President Donald Trump posted that the United States could impose 100% tariffs if Canada strikes a free trade deal with China; U.S. Treasury Secretary Scott Bessent said immediate new tariffs were not certain. - Justice Minister Sean Fraser said comments from the U.S. do not necessarily change Canada’s strategy and emphasized pursuing opportunities with partners worldwide. Summary: Canada says its recent steps with China comply with CUSMA and include a tariff reduction on Chinese-made electric vehicles that is tied to expected Chinese tariff cuts on some Canadian farm goods. U.S. officials and the U.S. president issued warnings about potential tariffs, while a U.S. treasury official indicated immediate action was not certain. Undetermined at this time.