Canada’s anti-Trump government is choosing closer ties with China — a move that will accelerate the country’s economic decline under the leadership of far-left Prime Minister Mark Carney.
The last-minute rejection of a trade deal with the United States and subsequent spin in media from Carney and other Liberal Party members was not the first move away from Western values. It was the latest in a concerted effort to poke their neighbor, which happens to be the world’s only existing superpower.
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Carney’s election in 2025 was driven by a frenzy he and his fellow Liberal Party leaders whipped up following concerns over trade and tariff policies destined to change when President Trump took office for his second term. Trump’s concerns over trade were not exactly new, as the U.S. – Mexico – Canada Agreement (USMCA) was an improvement over the North American Free Trade Agreement (NAFTA) but was imperfect. One of the clauses built into the deal was a review of shortcomings, which U.S. Trade Representative Jamieson Greer initiated July 1.
The Canadian Liberal Party maintained close ties to U.S. Democrats for over a decade, hosting former President Barack Obama and former Secretary of State Hillary Clinton at events, while also employing political operatives from the Democratic National Committee. Carney took an unprecedented step this year by naming one, Maia Johnson, to lead his office in a newly created Chief Operating Officer role while also managing Canadian-U.S. relations.
In January 2026, Canada and China agreed to a new trade deal. Under the terms of the agreement, Canada allowed China to dump 49,000 electric vehicles into the country at a most favored nation rate of 6.1 percent, replacing a previous 100 percent tariff. In exchange, China agreed to lower tariffs on Canadian canola seed to 15 percent.
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Carney called the agreement the beginning of “a new world order” and talked glowingly of the two nations being “strategic partners.” This despite the fact 73 percent of Canada’s exports come to the U.S., compared to just 4.4 percent to China.
Canada implemented retaliatory tariffs on up to $20 billion in U.S. goods in early September despite warnings from U.S. Treasury Secretary Scott Bessent not to do so. Bessent warned Canada that with trade uncertainty, companies faced with the choice of moving production will choose the United States.
President Trump immediately identified concerns over the two nations’ deal, writing that if Carney was going to “make Canada a ‘Drop Off Port’ for China to send goods and products into the United States, he is sorely mistaken. China will eat Canada alive, completely devour it, including the destruction of their businesses, social fabric, and general way of life.”
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The China trade concerns were echoed by Heritage Foundation Senior Research Fellow Brent Sadler, who said in an interview, “It might feel good at the moment to try to stick his finger in what he thinks is President Trump’s eye. The reality is he went to a country of an authoritarian communist regime that doesn’t acknowledge or respect religious freedoms, personal rights to freedom of speech. They have a social credit system that you get judged on every day in access to services, let alone medical services and everything else… It’s everything that’s antithetical to what the Canadian people seem to think and embrace in a liberal society. Makes no sense.”
Carney is reversing himself on China from his election-year position. He said China was Canada’s biggest security threat during the 2025 campaign, stating on April 18, 2025, the communist nation was one of the largest threats with respect to foreign interference in Canada and an emerging threat in the Arctic.
A report from the America First Policy Institute argued the agreement and any future attempts at continued economic integration between Canada and China would constitute an economic and national security threat to the United States.
“Distinctive aspects of the U.S.-Canada relationship, including a liberalized trading arrangement, trade of important commodities, and a border that is difficult to defend, are vulnerable to exploitation by U.S. adversaries,” the report summarized.
On the Canadian side, the Coalition of Concerned Manufacturers and Businesses Canada repeatedly warned Carney that instigating a trade war against the U.S. was a war he could not win. “Economic data about Canada that Carney cites in his communique paint a rosy picture of future Canadian economic prospects that simply defy belief give current statistics,” the group warned in August.
Canada’s economic output is already suffering. The country shed 110,000 jobs in the past two monthly jobs reports, with the unemployment rate edging up to 6.5 percent.
Follow Matt Mercer on X: @mattmercer.
