The Chinese communist government is accusing Canada of “protectionism” in response to the federal government announcing it will be imposing tariffs on Chinese-imported electric vehicles and related components on Monday.
Prime Minister Justin Trudeau said his government would be implementing a 100% tariff on Chinese EV imports and a 25% tariff on imported steel and aluminum.
The Chinese Commerce Ministry said that the country is “strongly dissatisfied and firmly opposes this” decision in a statement released on Tuesday.
The ministry claims these tariffs will disrupt the stability of industrial and supply chains on a global scale and damage the country’s economic ties with Canada.
“Canada claims it supports free trade and the multilateral trading system based on (World Trade Organization) rules, but it blatantly violated WTO rules and announced it will take unilateral tariff measures by blindly following individual countries. It is typical trade protectionism,” reads the statement.
The ministry called on the Trudeau government to “immediately correct its wrong practices,” stating that Beijing would take any necessary measures to secure the interests of Chinese companies.
The tariffs are slated to take effect this October.
“I think we all know that China is not playing by the same rules,” Trudeau told reporters in Halifax, Nova Scotia on Monday. “What is important about this is we’re doing it in alignment and in parallel with other economies around the world.”
The U.S. and Mexico have already implemented trade tariffs against China regarding EVs and their byproducts earlier this year.
Additionally, the European Union imposed tariffs of up to 37.6% on EV imports last month.
“The Government of Canada intends to implement a 100% surtax on all Chinese-made EVs, effective October 1, 2024. This includes electric and certain hybrid passenger automobiles, trucks, buses, and delivery vans. This surtax will apply in addition to the Most-Favoured Nation import tariff of 6.1% that currently applies to EVs produced in China and imported into Canada,” said the Department of Finance in a statement on Monday.
Despite Canada following in the footsteps of its economic allies, the government was told by Chinese Foreign Ministry spokesperson Lin Jian to “not politicize economic and trade issues.”
“China’s burgeoning electric vehicle industry is the result of continuous technological innovation, a well-established industrial and supply chain and full market competition,” said Jian.
While Chinese EV companies have yet to gain a stronghold in Canada, they are able to sell EVs for as low as USD $12,000, with enough labour and stock to supply the world’s demand.
Beijing officials argue that their domestic production keeps prices low and is helping to promote an environmentally green transition.
However, Conservative Leader Pierre Poilievre recently called out the practices of the Beijing government and accused China of producing “artificially cheap steel, aluminum and EVs,” saying that the country’s “massively subsidized steel” is made possible by “exploiting weak environmental and labour standards.”
“They’re doing this with the goal of crushing our steel, our aluminum, and our automotive production, and taking our jobs away,” said Polievere at a Stelco steel plant in Hamilton, Ont. earlier this month.
The Conservatives have called for the government to add tariffs to Chinese semiconductors, critical minerals as well as any other EV components.
The federal government said it plans to launch a second 30-day consultation concerning other sectors related to the auto industry, including “batteries and battery parts, semiconductors, solar products, and critical minerals” in a statement released on Monday.
“China has an intentional state-directed policy of overcapacity and oversupply designed to cripple our own industry,” said Deputy Prime Minister Chrystia Freeland on Tuesday.
“We simply will not allow that to happen to our EV sector, which has shown such promise.”