From January 14 to 17, 2026, Canadian Prime Minister Mark Carney will visit China. This visit marks the first time a Canadian prime minister has visited China since December 2017, attracting significant international attention. In October 2025, Chinese and Canadian leaders held their first meeting in eight years during APEC in South Korea. Subsequently, the two countries announced the restoration of the Joint Commission on Economic and Trade Cooperation, increased direct flights, and the resumption of group tours, laying the foundation for Carney’s groundbreaking visit. Mainland scholars believe that against the backdrop of global trade turmoil, the Carney government’s foreign policy is becoming more pragmatic, and the warming of Sino-Canadian relations offers important lessons for handling differences between countries. Behind the economic and trade cooperation lies Canada’s deep strategic consideration of reducing its over-reliance on the United States. As early as October 2025, Carney publicly stated his call for a rapid and radical change in Canada’s economic strategy, reducing its dependence on the United States in the economic and security fields, and promising to double exports to non-US markets over the next decade, with renewed engagement with China, India, and other countries becoming a key focus.
A solid economic and trade foundation provides confidence for the recovery of bilateral cooperation. China has long been Canada’s second-largest trading partner. In 2024, the total bilateral trade in goods reached US$118.7 billion, of which Canada’s exports to China amounted to US$29.9 billion and imports from China amounted to US$88.8 billion. On January 16, a joint statement was issued by the leaders of China and Canada. Both sides reaffirmed the importance of providing a fair and open business environment for enterprises of both countries and committed to promoting the resolution of each other’s economic and trade concerns through constructive consultations, including through a strengthened China-Canada Joint Economic and Trade Committee.
In the energy sector, both sides decided to launch a ministerial-level energy dialogue to identify key areas and support two-way investment and trade in clean and traditional energy. In the financial sector, both sides welcomed the establishment of the China-Canada Financial Working Group to strengthen exchanges on financial issues. Meanwhile, China and Canada will renew their bilateral currency swap agreement, with a swap size of 200 billion yuan. The agreement is valid for five years and can be extended with the consent of both parties. Furthermore, regarding people-to-people exchanges, both sides agreed to strengthen exchanges to enhance mutual understanding and cooperation, and decided to restart the China-Canada Joint Cultural Committee, dedicated to strengthening exchanges and cooperation in culture, education, arts, cultural heritage, and creative industries, and enhancing exchanges between the legislative bodies and local governments of the two countries. It is worth mentioning that Carney stated that Canada will import 49,000 Chinese electric vehicles at a preferential tariff rate of 6.1%, a return to the level before the trade friction.
Looking at the China-EU relationship, on January 12, China’s Ministry of Commerce issued a notice indicating that the consultations between China and the EU on the anti-subsidy case against Chinese electric vehicles had made substantial progress. Eligible Chinese electric vehicle companies can use price undertakings to replace anti-subsidy duties, marking a “soft landing” for the case. Looking back at the dispute’s history, in October 2024, the European Commission decided to impose a five-year final anti-subsidy duty on imported Chinese electric vehicles, with a maximum rate of 35.3%, hindering Chinese electric vehicle companies from entering the European market. However, the EU also stated its willingness to consult on price undertakings, leaving room for a subsequent resolution. This week, the EU announced the release of a “Guidance Document on Submitting Price Undertaking Applications,” confirming that it will adhere to the principle of non-discrimination, applying the same legal standards to each price undertaking application in accordance with WTO rules, and conducting assessments in an objective and impartial manner. Even under the influence of previous anti-subsidy duties, the momentum of Chinese cars entering the European market remains strong, and high tariffs have not significantly affected the sales of Chinese electric vehicles in Europe. Market analysis firm Dataforce predicts that by 2025, sales of Chinese cars in the EU, UK, and EFTA countries will exceed 700,000 units, far exceeding the 408,000 units in 2024. This strong performance not only demonstrates the core competitiveness of China’s electric vehicle industry in electrification and intelligentization but also lays the foundation for deeper cooperation between China and the EU in the subsequent industrial chain. Furthermore, China’s foreign trade is also about to undergo new changes. The Chinese Ministry of Finance announced that, starting April 1st, the Chinese government will cancel value-added tax export tax rebates for 249 products, including photovoltaic cells, ceramic roofing tiles, and lithium hexafluorophosphate. The statement further clarified that the VAT export rebate rate for 22 battery-related products, such as lithium-ion batteries, will be reduced from 9% to 6%; and that VAT export rebates for battery products will be cancelled from January 1, 2027. Behind this policy adjustment lies the practical consideration of the chaotic export situation in the photovoltaic industry. Since 2024, Chinese photovoltaic products have faced increasingly fierce competition in overseas markets, with export prices continuing to decline, showing a clear trend of “increased volume but decreased price.” Some companies, in the process of export price negotiations, directly converted export rebates into negotiating leverage, resulting in fiscal funds originally intended to offset domestic VAT burdens ultimately being transferred to overseas buyers. Analysts point out that against this backdrop, small and medium-sized enterprises with weak cost control capabilities, low technological levels, and poor risk resistance will face enormous operational pressure after this adjustment; while leading companies with brand advantages, mature overseas channels, and strong negotiating power will be relatively less affected, which will accelerate the industry reshuffling process. However, judging from the short-term market reaction, some believe that the “zero” export tax rebate rate for photovoltaic products may stimulate overseas customers to “snap up” orders in advance, bringing about a short-term surge in export demand. Furthermore, this adjustment will also drive photovoltaic companies to accelerate their overseas expansion and transformation. In recent years, countries such as Europe and the United States have been promoting local manufacturing strategies. The implementation of policies such as the US Inflation Reduction Act and the EU Net Zero Industrial Act has led photovoltaic companies to “go global” primarily to circumvent trade barriers. Now, the elimination of export tax rebates will further force companies to move beyond the traditional “Made in China, supplied globally” model and towards a globalized layout of “Made globally, supplied locally.” In this process, globalization capabilities will become a core competitive advantage for companies, and emerging markets such as Africa, the Middle East, and South America will become new growth engines for photovoltaic companies.
