What happened
Canada's government, led by Prime Minister Mark Carney, has chosen to strengthen ties with China, a move expected to accelerate the country's economic decline. This decision comes after the last-minute rejection of a trade deal with the United States. Canada and China agreed to a new trade deal in January 2026, allowing China to export 49,000 electric vehicles to Canada at a reduced tariff rate, while China lowered tariffs on Canadian canola seed.
The Canadian government's actions have been met with criticism from the US, with President Trump expressing concerns that Canada is becoming a 'drop off port' for Chinese goods. The US has also warned Canada that implementing retaliatory tariffs on US goods could lead to companies moving production to the US.
Canada's economic output is already suffering, with 110,000 jobs lost in the past two months and an unemployment rate of 6.5%. The country's decision to strengthen ties with China has been questioned by experts, who argue that it goes against Canada's values and could pose an economic and national security threat to the US.
