Canada Agrees With US Concerns About Mexico’s Trade With China

(Bloomberg) --

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Canadian Deputy Prime Minister Chrystia Freeland said American concerns about Mexico’s trade policy not being in line with its North American allies on China are “legitimate,” and she shares them.

But she did not comment directly on whether Canada should pursue a bilateral trade deal with the US that excludes Mexico, a position advocated Tuesday by the leader of Canada’s largest province, Ontario Premier Doug Ford.

Freeland, speaking to reporters in Ottawa, said she’s heard concerns about Mexico’s trading relationship with China from people expected to serve alongside US President-elect Donald Trump, as well as current officials in the Biden administration and other American business leaders.

She said they have “concerns that Mexico is not acting the way that Canada and the US are when it comes to its economic relationship with China, and I do have some sympathy with those concerns.”

She added later that “those are legitimate concerns for our American partners and neighbors to have; those are concerns that I share.”

This summer, Canada announced it would implement a 100% tariff on electric cars and a 25% levy on steel and aluminum from China, broadly in line with levels proposed by the Biden administration.

Those tariffs make Canada “the only country in the world which is fully aligned with the United States today when it comes to economic policy vis-a-vis China, and that speaks to the fact that our fundamental economic interests are so aligned,” said Freeland, who is also finance minister.

Mexico has argued it’s already doing its part, imposing tariffs earlier this year designed to curb the flow of steel from China after the US complained it was ending up in products shipped north across the border.

Freeland led Canada’s efforts to negotiate the North American free trade pact during the first Trump administration, and is expected to again be Prime Minister Justin Trudeau’s point person for dealing with the incoming Trump government.

The pact known as the United States-Mexico-Canada agreement is scheduled for a joint review before July 2026, and Trump said in October that he intends to renegotiate the deal.

In a statement on Tuesday, Ford said Mexico should “at the very least” match US and Canadian tariffs on Chinese imports, or “they shouldn’t have a seat at the table or enjoy access to the largest economy in the world.”

“We must prioritize the closest economic partnership on earth by directly negotiating a bilateral US-Canada free trade agreement that puts US and Canadian workers first,” said the Ontario premier, whose province hosts the majority of Canada’s auto manufacturing facilities.

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