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Canada’s industry minister says Ottawa is “considering all measures” after the U.S. announced it would be hiking tariffs on Chinese electric vehicles and other related goods.
François-Philippe Champagne wouldn’t rule out Canada imposing similar tariffs during an interview with CBC News Network’s Power & Politics on Friday.
“It’s fair to say that everything is on the table to protect our industry and our workers,” Champagne told host David Cochrane.
“We’re working in sync with the United States of America.”
President Joe Biden announced earlier this week that the U.S. would be slapping new tariffs on Chinese electric vehicles (EVs), advanced batteries, solar cells, steel, aluminum and medical equipment.
The tariffs are to be phased in over the next three years; those that take effect in 2024 are covering EVs, solar cells, syringes, needles, steel and aluminum and more.
There are currently very few EVs from China in the U.S., but American officials worry that low-priced models made possible by Chinese government subsidies could soon start flooding the U.S. market.
In a separate interview on Tuesday, Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, said “Canada has to” implement similar trade levies.
“Now that the Americans have put up a tariff wall, we can’t leave the side door open here,” Volpe told guest host John Paul Tasker.
Brian Kingston, president of the Canadian Vehicle Manufacturers Association, echoed Volpe’s argument in a post on X, formerly Twitter.
“Canada cannot be out of step with the U.S. on China. We need aligned policies that strengthen the North American auto supply chain,” he wrote.
Champagne insisted that Canada wouldn’t be a route for China to gain access to the North American EV market.
“Canada has never been and will never be a backdoor [for] China in the North American market and our U.S. friends understand that,” he said.
The federal government has partnered with provinces to attract investments from major automotive manufacturers to spur electric vehicle production in Canada.
The same day the U.S. announced its new tariffs, Asahi Kasei Corp., in partnership with Honda, announced the construction of a $1.6-billion electric vehicle battery plant in Port Colborne, Ont.
Volpe said domestic EV production could be held back if China floods the Canadian market with cheaper products.
“There’s no logic for Canada to force our market to electrify and then turn the market over to the Chinese,” he said.
China has maintained that the U.S. tariffs are a violation of international trade rules. It is not clear how the country will respond at this point.
Volpe suggested Beijing could retaliate by implementing export controls on its critical minerals that are used in EV battery manufacturing.
Champagne said it’s important for Canada to shore up its own critical mineral production.
On Thursday, Canada and the U.S. announced they would be co-investing in critical mineral producers for the first time as they work to boost regional supplies.
Natural Resources Canada and the U.S. Department of Defense are together putting about $32.5 million into Fortune Minerals Ltd. — which is working on a project with bismuth and cobalt in the Northwest Territories — and Lomiko Metals Inc., focused on a graphite project in Quebec.
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Biden strongly opposed increasing tariffs on EVs when he first came into office because they would lead to huge price increases for consumers and backfire. And now he changed his minded, but the consequences didn’t. Canada getting in between US and China in this trade war is a bad idea.
This is not ‘only’ about trade or dominance in a particular market such as EVs or solar panels. China aims to leverage market dominance for political influence. The Chinese government wants to export not just products but its autocratic system.
Either China sucks at it or that’s not their goal, since they have been trading with each other for 40+ years.
And US welcomes its autocrats like Donald Trump on its own, they don’t need China for that.
There is much evidence about this and a strong body of research. As researcher in the Journal of Democracy write, for example:
China’s Threat to Global Democracy (here is the [archived link](China’s Threat to Global Democracy))
China’s economy is slowing, and the regime is coming under greater domestic pressure—witness the large-scale protests that broke out against Xi’s covid-zero policy in multiple cities and on dozens of university campuses in late 2022. Beijing is encountering growing international criticism and resistance on other fronts as well. Around the world, negative views of China have surged to highs not seen since the 1989 Tiananmen Square Massacre […]
China’s rulers also have long understood what political scientists have proven empirically: Autocracies often fall in waves, as revolutionary activity in one country inspires popular uprisings in others […]
The CCP has responded with stepped-up repression over the past decade—jailing dissidents, mobilizing security forces, censoring information, and preempting popular unrest. Yet China is now strong enough that it can do more than just hunker down in the face of foreign pressure. Xi believes that the CCP’s domestic power will be enhanced if authoritarianism is prevalent and democracies are dysfunctional—fellow despots will not punish China for rights abuses, and the Chinese people will not want to emulate the chaos of liberal systems. He thinks that preventing revolts against authoritarianism in other countries will lower the odds of such a revolt erupting in China. And he believes that silencing critics abroad will limit the challenges facing the CCP within China. Xi sees rolling back democracy overseas as part of his plan to secure his regime at home […]
Beijing spends billions of dollars annually on an “antidemocratic toolkit” of nongovernmental organizations, media outlets, diplomats, advisors, hackers, and bribes all designed to prop up autocrats and sow discord in democracies. The CCP provides fellow autocracies with guns, money, and protection from UN censure while slapping foreign human-rights advocates with sanctions. Chinese officials offer their authoritarian brethren riot-control gear and advice on building a surveillance state; PRC trade, investment, and loans allow those dictators to avoid Western conditionality regarding anticorruption or good governance.
Beijing uses its globe-spanning media organs to tout the accomplishments of illiberal rule while highlighting democratic governments’ flaws and hypocrisies. China works with fellow authoritarian regimes, such as Vladimir Putin’s in Russia, to push autocrat-friendly norms of internet management in international institutions and standards-setting bodies.
These are some quotes, but whole article makes an interesting read.
It was an interesting read. Thanks.
And while there are many points I agree with, the core principle that China wants to use trade to export autocracy just doesn’t mesh. Trade is the best way to prevent military conflicts since trade creates dependencies which would be cut off during any military action. I would say the opposite is happening now with the current wave of protectionism in both the US and China.
China will take opportunities to insert themselves in other countries when it suits them, but it’s no different from what democratic countries do. Just look at Africa and how to this day France refuses to abandon its economic influence they hold via CFA franc currency. Or US trying to insert democratic rule in countries that have strategic value to them by any means necessary (the publication mentions US abandoned strategy), but we know it’s not true. There are public details about US coup attempts in Venezuela just recently.