China says Canada is being protectionist with its announcement of coming tariffs on Chinese EVs.

　　Not surprisingly, China has issued a statement accusing Canada of protectionism in response to the Canadian governments announcement that it will slap 100-percent tariffs on imported Chinese electric vehicles. The new policy is in line with a similar announcement made previously by the U.S. government.

　　Since Chinese electric vehicles are heavily subsidized by Chinas government, there are fears in other markets of unfair competition that would jeopardize the electrification efforts of global automakers.

　　The Chinese Ministry of Commerce said today that the new tariffs will disrupt the stability of global industrial and supply chains. Above all, it warned there will be serious consequences for economic and trade relations between China and Canada, and for businesses in both countries.

　　The statements says that China is strongly dissatisfied and firmly opposes this measure. It goes on to say that Canada claims it supports free trade and the multilateral trading system based on (World Trade Organization (WTO)) rules, but it blatantly violated WTO rules and announced it will take unilateral tariff measures by blindly following individual countries. It is typical trade protectionism.

　　The ministry urged Canada to immediately correct its wrong practices and said Beijing would take all necessary measures to defend the rights and interests of Chinese companies.

　　Canada will also impose a 25-percent tariff on Chinese steel and aluminum. Players like China have chosen to give themselves an unfair advantage in the global marketplace, said Canadian Prime Minister Justin Trudeau.

　　It remains to be seen how certain manufacturers will be affected by the new tariffs. One example is Volvo, preparing to market its new EX30, which is currently manufactured in China. Tesla could also be affected, as it manufactures Model 3 and Model Y vehicles in China. It could, however, reorganize its distribution so that Canada is supplied by its other factories.

　　Deputy Prime Minister Chrystia Freeland said Canada would also launch a 30-day consultation on possible tariffs on batteries, battery components, semiconductors, critical minerals, metals and solar panels that originate in China.

　　China is pursuing an intentional policy of overcapacity and oversupply aimed at crippling our own industry. We simply will not allow this to happen in our electric vehicle sector, which has shown so much promise, Freeland said.

　　We recommend everyone buckles up their seatbelts, because this is just beginning and it promises to be a bumpy ride.