Canada to Impose Tariffs on Chinese Minerals

Canada will impose tariffs on critical minerals from China beginning in early 2025. These measures are designed to limit Chinese trade practices in North America, aligning with the approach of incoming US President Donald Trump. Although the government has not disclosed the full scope of the tariffs, it has indicated that further details will be released soon.

Prime Minister Justin Trudeau's government has consistently criticized China's overproduction and excess capacity, arguing that these practices harm Canadian jobs by flooding the market with low-cost Chinese goods. In response, the government has already implemented a 100% tariff on Chinese electric vehicles and a 25% tariff on imports of Chinese steel and aluminum.

Experts note that the strengthening of these measures follows Trump's pledge to impose a 25% tariff on Canadian goods if Canada does not address issues related to the flow of drugs and illegal immigration across its border with the United States.

China-US Trade War

China recently announced an export ban on gallium, germanium, antimony, and superhard materials, along with tighter controls on graphite. According to CITIC Securities, these actions signal the beginning of China’s efforts to safeguard national security and enhance its strategic influence over critical resources. China’s restrictions come in the wake of US Biden administration’s limitations on the sale of advanced memory chips to China, designed to curb its progress in semiconductor and AI technologies, as well as Trump's threats. 

Analysts foresee an increased likelihood of a renewed US-China trade war under Trump’s administration, with Beijing expected to employ export controls as a countermeasure to US tariffs. However, experts point out that further export restrictions could accelerate efforts by the United States and its allies to diversify supply chains, potentially undermining China’s leverage.