(CTN News) – Canada is considering imposing import taxes on Chinese-made electric vehicles and will seek public feedback on the proposal, according to Deputy Prime Minister Chrystia Freeland.
On Monday, Freeland stated that the local auto industry faces unfair competition from what she calls China’s “state-directed policy of overcapacity,” and that Ottawa would launch a 30-day public consultation session on July 2 to determine how Canada should respond.
“Chinese producers are quite intentionally generating a global oversupply that undermines EV producers around the world, including here in Canada,” Freeland told reporters in Vaughan, Ontario, repeating worries expressed by the US and the EU.
China’s Rebuttal to Canada’s Accusations
Freeland stated that public discussions will assist the government decide on its policy response, which may include import duties, and that the action would align Ottawa with its partners in Washington and Brussels.
Last month, US President Joe Biden announced significant tax increases on Chinese imports, including electric automobiles. The European Commission intends to levy up to 38.1 percent tariffs on Chinese producers, including BYD, Geely, and SAIC, as well as Chinese-made Tesla and BMW vehicles.
China has denied allegations of unfair subsidies or an overcapacity problem, claiming that the growth of its EV industry is due to advantages in technology, market, and industry supply chains.
Prior to Freeland’s declaration on Monday, an opinion post in the Chinese state-backed Global Times daily argued that “Canada should remain strategically rational” and not “sacrifice normal economic exchanges with China for the sake of Washington’s strategic selfishness.”
Canadian tariffs on Chinese EVs “may undermine market confidence among Chinese investors, deteriorate bilateral relations, and impede normal economic and trade cooperation,” a Global Times writer wrote in an editorial piece.
Prime Minister Justin Trudeau’s Liberal government, which has been attempting to position Canada as an important component of the global EV supply chain, had faced domestic pressure to act against Chinese EVs.
The premier of Ontario, Canada’s most populated province and key car-making center, requested Ottawa this week to put at least 100 percent tariffs on Chinese-made electric vehicles in order to protect jobs.
Freeland declined to discuss the specifics of Ottawa’s prospective action or if EV components like as batteries may be targeted, but said everything was on the table.
“We’re not ruling anything out,” she stated, including “that we are bringing to bear our strongest trade action tools.”
Canada has signed billion-dollar partnerships to entice companies involved in all stages of the EV supply chain to strengthen its manufacturing heartland in Ontario.