Bessent Observes Carney of Canada Reversing Stance on Trade with China

Canada’s Trade Policy Shift Sparks US Criticism

Photo Credit: Sean Kilpatrick/The Canadian Press/AP

US Treasury Secretary Scott Bessent has accused Canadian Prime Minister Mark Carney of reversing course by reaching an agreement with China to ease certain trade restrictions. This move has added weight to President Donald Trump’s recent threats to impose new tariffs on Canadian imports.

“Just a few months ago, Canada joined the United States in imposing steep steel tariffs on China due to concerns over dumping,” Bessent stated on ABC’s Sunday program. “Europe took similar action. Now, it appears Prime Minister Carney has changed direction.”

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Earlier this month, Canada agreed to reduce tariffs on 49,000 Chinese electric vehicles to 6%, eliminating a previous 100% surcharge. This step is part of a broader initiative to restore relations with Beijing. Prime Minister Carney also indicated that China may lower tariffs on Canadian rapeseed after discussions with President Xi Jinping.

The Trump administration has strongly criticized this bilateral arrangement, warning that it could lead to further tariffs on Canadian products and complicate the renegotiation of the US-Mexico-Canada trade agreement, which is set for review this summer.

Bessent cautioned that if Canada signs a free trade pact with China and becomes a gateway for low-cost goods to enter the US—especially in the automotive sector—the US could respond with tariffs as high as 100% on Canadian exports.

He also noted that China might face additional trade penalties if the agreement with Canada extends beyond what has already been disclosed.

Photo Credit: Eric Lee/Bloomberg

“Our economies are deeply intertwined,” Bessent explained. “Goods often cross the US-Canada border multiple times during production. We cannot allow Canada to serve as a backdoor for Chinese products to flood the US market at artificially low prices.”

Dominic LeBlanc, Canada’s minister responsible for US trade relations, clarified on Saturday that Ottawa is not seeking a free trade agreement with China. He emphasized that the recent talks between Carney and Xi were focused on resolving specific tariff disputes.

Bessent also mentioned the upcoming review of the US-Mexico-Canada trade agreement but did not elaborate on how the current tensions might influence those negotiations.

On Saturday, Trump issued a warning via Truth Social, stating that if Carney intends to turn Canada into a “Drop Off Port” for Chinese goods destined for the US, he is “sorely mistaken.”

Carney’s Davos Speech and US Response

Trump’s remarks came after Carney delivered a widely discussed speech at the World Economic Forum in Davos, where he urged middle powers to unite against the coercive tactics of major world powers. Although Carney did not name any countries, many interpreted his comments as a veiled reference to the United States.

Carney’s Message to Davos: The Rules-Based Order Is Dead

Bessent criticized Carney’s approach, suggesting that the prime minister was more interested in appealing to global elites at Davos than addressing the concerns of North American trade partners.

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