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Feud with Trump Leads Canada to Shut Down Expansive Trade Relationship with China

January 26, 2026

President Donald Trump’s greatest weapon may not be the “discombobulator,” but tariffs. Canadian Prime Minister Mark Carney has tried to distance himself from an apparent trade deal with China after Trump threatened to impose a 100% tariff against Canadian products sold in the U.S.

Carney recently brokered a deal with Chinese President Xi Jinping allowing up to 49,000 Chinese-made electric vehicles to be sold in the Canadian market at a 6.1% tariff rate, significantly lower than the 100% tariff rate Canada agreed to impose on the Chinese products in 2024. In exchange for Canada’s decreased tariff rates, the deal would see China lower the retaliatory tariffs it imposed against Canadian agricultural products, including canola oil, pork, and seafood.

“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 warned on Truth Social over the weekend, in response to the Canada-China deal. “If Canada makes a deal with China, it will immediately be hit with a 100% Tariff against all Canadian goods and products coming into the U.S.A.,” he added. “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!” the president said in a separate post.

Carney responded Sunday, clarifying that Canada would not, in fact, be expanding trade relations with China. “We have no intention of doing that with China or any other nonmarket economy,” the prime minister said in a press conference. “Canada respects our engagements, our commitments,” he reiterated, referring to the Canada-U.S.-Mexico Agreement (CUSMA) trade pact. Under the terms of CUSMA, Carney would have to notify his American and Mexican counterparts if he were to open a free-trade relationship with China. He stressed that Canada would “never” establish such a relationship with China without first consulting the U.S.

Chinese Foreign Ministry spokesman Guo Jiakun affirmed that the deal struck between Carney and Xi was not a free-trade agreement but merely the readjustment of tariffs imposed on specific products. “China and Canada have established a new type of strategic partnership and made some specific arrangements on properly handling the economic and trade issues between the two countries,” he told reporters Monday. “This reflects the spirit of equality, openness, and inclusiveness, peaceful cooperation, and shared benefit. It does not target any third party,” he claimed. “China believes countries need to approach state-to-state relations in the spirit of win-win rather than the mentality of zero-sum, and through cooperation rather than confrontation.”

The spat between Carney and Trump was on full display at the World Economic Forum’s (WEF’s) annual meeting in Davos, Switzerland, last week. Trump made comments critical of Canada’s ability to sustain itself economically or politically, suggesting that the U.S.’s northern neighbor only “lives because of the United States,” while Carney lashed out at Trump’s use of tariffs to pressure European forces into negotiating trading or selling Greenland to the U.S.

“Canada doesn’t live because of the United States. Canada thrives because we are Canadian,” the prime minister responded to Trump, prompting the U.S. president to un-invite Carney from sitting on his newly-formed Board of Peace, centered on ensuring lasting peace in Gaza. Trump said that the U.S. often gives Canada “freebies” and that Carney “should be grateful,” but the prime minister’s WEF speech demonstrated that he “wasn’t so grateful.” In a speech in Quebec, after leaving Davos early, Carney accused Trump of “authoritarianism,” urging other world leaders to reject America’s vision for the future.

Appearing on “Washington Watch” Friday night, Gatestone Institute Distinguished Senior Fellow Gordon Chang pointed to the “Donroe Doctrine,” an updated take on the Monroe Doctrine. While the Monroe Doctrine, articulated by President James Monroe in the first quarter of the 19th century, stipulates that influence over the Western hemisphere belongs to the U.S. rather than Europe, the “Donroe Doctrine” expands the terms of the Monroe Doctrine to mitigate China’s and Russia’s influence in the Western hemisphere, too.

“The United States is the only power that can protect Greenland and Canada and the Arctic from increasing Chinese and Russian activity, because we’ve seen a noticeable increase in what Beijing and Moscow are doing up there, not only with their commercial activities, but also with their military flybys and with their naval patrols,” he observed.

“President Trump clearly has revived the Monroe Doctrine, he did that in his first term,” Chang elaborated. “… In the national security strategy, it’s made it clear that the United States will not tolerate malign foreign interference in this region. That’s good, because we need to get the Chinese, the Russians, and the Iranians out of Latin America and away from our borders.”

S.A. McCarthy serves as a news writer at The Washington Stand.



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