BEIJING: Canada and China are preparing to reap “historic” gains from a new strategic partnership, Canadian Prime Minister Mark Carney said on Friday during talks with Chinese President Xi Jinping.
Read More: Canadian PM seeks reset with China amid US tensions
Carney, the first Canadian prime minister to visit China since 2017, emphasized leveraging each country’s strengths in areas such as agriculture, agri-food, energy, and finance. “It is important to start this new strategic partnership at a time of division,” he told Xi, stressing the potential for “immediate and sustained progress.”
🚨 Mark Carney just cut a tariff quota deal with China on EVs and canola and that alone is going to set off alarms everywhere.
This is Canada recalibrating trade in real time while global tensions stay hot.
EVs, agriculture, China at the same table. This move helps farmers… pic.twitter.com/ZzDPdSyShk
— TheCommonVoice (@MaxRumbleX) January 16, 2026
The initiative comes after months of diplomatic efforts to restore ties following U.S. tariffs on Canadian goods and tensions in trade relations. China, which also faced U.S. tariffs under President Donald Trump’s administration, has shown interest in strengthening economic cooperation with a Group of Seven nation within a traditional U.S. sphere of influence.
President Xi welcomed the partnership, highlighting shared responsibility toward history, peoples, and global stability. Analysts note that while this rapprochement could reshape Sino-U.S. economic dynamics, Canada is unlikely to pivot away from Washington. Sun Chenghao, a fellow at Tsinghua University, said Ottawa remains a core U.S. ally but could pursue a pragmatic and autonomous economic policy toward China.
Despite optimism, economic hurdles remain. Canada imposed tariffs on Chinese electric vehicles in 2024, citing market distortions from state subsidies, prompting China to retaliate with tariffs on over $2.6 billion of Canadian farm and food products, including canola, resulting in a 10.4% slump in Chinese imports of Canadian goods in 2025. Talks to resolve remaining trade issues are ongoing, according to Canada’s industry minister.
Read More: China seeks stronger ties with Canada amid trade disputes
The new partnership signals both nations’ intent to deepen collaboration while navigating geopolitical and economic challenges, offering potential long-term benefits to businesses and industries in both countries.