Carney Says Canada Has ‘No Intention’ of Pursuing a Free Trade Agreement With China

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Jan 26, 2026 - 10:48 Updated: Jan 26, 2026 - 10:43
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Carney Says Canada Has ‘No Intention’ of Pursuing a Free Trade Agreement With China

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Prime Minister Mark Carney says Canada does not intend to pursue a free trade agreement with China, after U.S. President Donald Trump said Canadian goods would be hit with 100 percent U.S. tariffs if Canada “makes a deal with China.”

Carney told reporters ahead of a Liberal caucus meeting in Ottawa on Jan. 25 that Canada has commitments under the United States–Mexico–Canada Agreement (USMCA) “not to pursue free trade agreements with non–market economies without prior notification.”

“We have no intention of doing that with China or any other non–market economy,” Carney said. “What we’ve done with China is to rectify some issues that developed in the last couple of years.”

He used the expression “back to the future” to describe Canada’s agreements with China on electric vehicles, agriculture, fish products, and other food products, noting that the difference between now and the past is that there are now “additional protections,” such as a cap on Chinese EVs.

“It’s entirely consistent with [USMCA], with our obligations, which we very much respect under [USMCA], and will continue to work that way,” Carney added.

Carney met with Chinese leader Xi Jinping in Beijing during his trip to China from Jan. 13 to Jan. 17, where he signed a series of agreements that include cutting tariffs on Chinese EV imports from 100 percent to 6.1 percent for the first 49,000 vehicles, in exchange for China cutting tariffs on Canadian canola from 85 percent to 15 percent until at least the end of the year.

While he was in China, Carney said Ottawa was in a “strategic partnership” with Beijing and that the relationship had entered a “new era.” He also said progress made in the “partnership” with China “sets us up well for the new world order.”
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Trump had initially shrugged off Carney’s new agreement with China, telling reporters on Jan. 16 that, “It’s a good thing for him to sign a trade deal. If he can get a deal with China, he should do that.” However, his cabinet expressed concern about Canada’s agreements with China, with U.S. Transport Secretary Sean Duffy saying Canada “will live to regret the day they let the Chinese Communist Party flood the market with their EVs.”
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Trump later also joined his cabinet in criticizing the agreements, saying in a Truth Social post on Jan. 24 that Canadian goods exported to the United States would be hit with 100 percent tariffs if Canada “makes a deal with China.”

“If Governor 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. China will eat Canada alive, completely devour it, including the destruction of their businesses, social fabric, and general way of life,” Trump wrote.

His use of the term “governor” reflects Trump’s view that Canada should be part of the United States. He had used the title for former Prime Minister Justin Trudeau but had so far not used it for Carney, with whom he had maintained cordial relations, until those relations soured after Carney criticized U.S. policies in a speech to world leaders at the World Economic Forum in Davos, Switzerland, on Jan. 20.

In a subsequent post on the same day, Trump said, “The last thing the World needs is to have China take over Canada. It’s NOT going to happen, or even come close to happening!”
Canada–U.S. Trade Minister Dominic LeBlanc stressed the importance of Canada–U.S. relations in a Jan. 24 statement, posted shortly after Trump’s social media posts, and noted that Ottawa is not pursuing a free trade deal with China.

Davos Speeches

Tensions heightened between Carney and Trump after the two leaders criticized each other’s comments on U.S.–Canada and international relations in public speeches at the WEF last week.
Carney criticized U.S. pressure to take over Greenland in his speech on Jan. 20 and called for countries to not comply with “great powers,” saying the rules-based international order has undergone a “rupture.”
Meanwhile, Trump said in his own speech on Jan. 21 that he listened to Carney’s speech and that the Canadian prime minister “wasn’t so grateful,” adding that Canada “lives because of the United States.”
Carney rebuked Trump’s remarks on Jan. 22, saying Canada “does not live because of the United States. Canada thrives because we are Canadian.”

Trump said later on Jan. 22 that he is rescinding an invitation to Carney to join the U.S.-led Board of Peace that seeks to rebuild Gaza.

Meanwhile, U.S. Commerce Secretary Howard Lutnick said on the same day that Ottawa could risk jeopardizing the upcoming USMCA renegotiations by seeking closer relations with China.
Omid Ghoreishi contributed to this report.
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