China and Canada agree to tariff cuts

CHINA and Canada have agreed to roll back a series of punitive tariffs following high-level talks in Beijing between Chinese President Xi Jinping and Canadian Prime Minister Mark Carney, signalling a tentative thaw after years of trade and diplomatic friction.

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Under the agreement, China is set to reduce tariffs on Canadian canola oil to 15% from the current 85% by 1 March, while Ottawa will apply a most-favoured-nation tariff of 6.1% on Chinese electric vehicles, Carney told reporters after the meeting.

The understanding marks a breakthrough following prolonged tit-for-tat trade measures that had weighed on bilateral commerce. Xi described the outcome as a "turnaround" in relations, while for Carney it represents a diplomatic and economic win, making him the first Canadian leader to visit China in almost a decade.

Carney has been seeking to diversify Canada's trade relationships, particularly as uncertainty persists around United States trade policy and the renewed use of tariffs under former President Donald Trump. Observers say the agreement could also open the door to increased Chinese investment in Canada, a sensitive issue given Ottawa's proximity to the US market.