What’s Behind the Push for Closer Canada-China Ties Amid US Trade Tensions?

The Chinese Embassy in Ottawa

Some premiers expressed support for closer trade ties with China last week as a way to reduce Canada’s reliance on the United States amid rising tariff tensions. There have also been recent newspaper commentaries echoing Beijing’s position that Canada should forge a closer relationship with China.

Some observers say there appears to be forces pushing Canadian politicians toward China amid tensions with Washington. Catherine Swift, president of the Coalition of Concerned Manufacturers and Businesses Canada, says profit may be a driving factor as corporations back closer ties with Beijing for access to economic opportunities and lower costs.

“It’s no secret [that] there’s people in all countries that I’m sure are profiting very nicely from doing business with China,” Swift said in a recent interview. Swift is a former CEO of the Canadian Federation of Independent Business and has served as a senior economist for think tanks and banks.

Beyond profits, Canada should consider all aspects before increasing trade with China, Swift said, including what she called Beijing’s “unfair” trade practices such as dumping, which involves selling products to another country at a price below their normal value. Low labour standards, human rights abuses, and its interference in Canada’s democracy are also issues to consider, she said.

“There’s a lot more negatives than positives in expanding our trade with China,” Swift added.

“I think they’re translating their dislike of Trump into looking for options,” she said.

Sheng Xue, a Toronto-based writer and outspoken Chinese human rights activist, says another factor may be Canada’s “naivety” in believing that the Chinese Communist Party (CCP) will change its ways or not use economic tools to advance its goals.

Ontario Premier Doug Ford said last week he would be open to dealing with Beijing, as long as it “plays fair and doesn’t undercut our markets.” This marked a sharp shift from his stance earlier this year, when he accused the regime of “hijacking global supply chains to unfairly benefit Chinese companies” and urged the United States and Canada to work together to address China as “the problem.”

Sheng warns that Canada “must not repeat the same mistake of fantasizing that economic engagement with the CCP will somehow lead to political reform,” adding that “there is no true win-win scenario” with the Chinese regime.

“Over the past several decades, the CCP’s behaviour on the global stage—including transnational repression, information warfare, influence operations, and economic predation—has made it abundantly clear that its ‘cooperation’ with other countries is not based on equality or mutual benefit, but on manipulation, control, and exploitation,” she told The Epoch Times.

Former Canadian ambassador to China David Mulroney has also said that closer ties with Beijing are not the answer to Canada’s tensions with the United States.

“The same sense of national self-confidence and geopolitical maturity we need for navigating our crisis with Washington should also help us reject calls—as predictable as they are lazy—to rush back to Beijing,” he said in a July 28 social media post.

Consequences for Canada

Sheng says deeper ties with China could threaten Canada in several areas, including national security, democracy, and core values. She says it could help China grow its intelligence networks in Canada, making it harder to protect the country’s sovereignty.

She cited the presence of secret Chinese police stations in Canada as an example of China’s threats to the country’s sovereignty. Beijing has used those stations to monitor and intimidate Chinese dissidents, according to a 2022 report by the Spanish NGO Safeguard Defenders. Meanwhile, cyber actors linked to the CCP have been identified as “the greatest ongoing cyberespionage threat to Canada,” according to the Canadian Centre for Cyber Security.

Another risk is China’s ongoing efforts to influence Canada’s elections. Sheng notes Beijing has already attempted to interfere in previous Canadian elections, being described by the recent national inquiry into foreign interference as the “most active perpetrator of foreign interference targeting Canada’s democratic institutions.”

“Closer ties would only embolden these tactics,” Sheng said.

Swift holds a similar view, saying that closer ties would send China the wrong message—that Canada supports its actions “at a time that we shouldn’t be encouraging them.” It would be like saying, “keep interfering in our elections, keep surveilling and threatening our people... because we want closer relations with you,” Swift said.

Another way in which Canada’s interests would be affected by closer ties with Beijing is what Sheng calls a “loss of economic sovereignty.” She says China would “hollow out” Canada’s domestic industries through supply chain domination, strategic investments, and technology acquisition, turning Canada into a “mere source provider” or a “satellite supply base for China.”

Former diplomat Michael Kovrig, who was detained in China in 2018 for more than 1,000 days along with fellow Canadian Michael Spavor following Huawei executive Meng Wanzhou’s arrest in Vancouver, has voiced similar concerns. In a July article, he said Beijing’s vision of a mutually beneficial relationship would lock Canada into a dependent trade position as “a supplier of energy and commodities and absorber of some of China’s structural manufacturing overcapacity.”

Likewise, Swift said more trade with China would hurt Canadian industries. “There are so many examples of China using unfair trade practices, certainly competing unfairly with our manufacturing community and businesses in general,” she said.

Canada’s international reputation could also be harmed if it seeks closer ties with Beijing, Sheng argued, putting it at odds with democratic allies like the G7 countries, which are working to reduce dependence on China. “Canada would risk marginalization within key alliances like the Five Eyes and G7 if it moved in the opposite direction,” she said.

Canada faced warnings from the Five Eyes alliance in 2019 for not banning China’s Huawei from its 5G networks, with U.S. officials threatening to limit intelligence sharing with countries keeping Huawei in critical infrastructure. Canada ultimately banned Huawei equipment in 2022, aligning with its allies.

Meanwhile, the United States has asked its partners not to align themselves with Beijing. U.S. Ambassador to Canada Pete Hoekstra said earlier this year that the United States is looking for support from allies, including Canada, in the face of the threats posed by China.

“The President has made it very, very clear. The No. 1 challenge to America’s security, to its safety, and prosperity is China,” Hoekstra told the Globe and Mail earlier this summer. “We’re looking for people who will confront the challenges with China with us.”

Swift adds that another risk of closer ties with China is the threat to national security from hidden data-collecting devices in Chinese products. A prominent example, cited in a 2024 U.S. government report, involves “unauthorized cellular modems” found in Chinese-made cranes bound for U.S. ports that were unrelated to operational functions and designed to collect usage data.

US Relations

Swift says a major decision like strengthening ties with China and reducing trade ties with the United States should not be based on the actions of a single president, whose time in office is limited.

She calls such a shift short-sighted, arguing it would replace a “centuries-long, massively successful trade relationship with the U.S.” with one involving Beijing, which she says “has never done anything in Canada’s interests.”

“The way to fix our issues is not to cozy up to China, but to get a proper deal with our larger trading partner,” she said. “I think we should deal with the trading partner who has been the most beneficial to Canada by a long shot.”

Sheng also said she believes that Canada should not distance itself from the United States, not only because of the long-standing trade relationship, but also because of shared national security interests and “democratic values,” such as freedom and democracy.

“If Canada were to betray this alliance now—or attempt to gain short-term benefits from the Chinese market—it would be seen as undermining its credibility among allies,” Sheng said, adding that the CCP “would interpret this as weakness and escalate its pressure and manipulation.”

“The U.S. would likely lose trust in Canada, weakening cooperation even in vital strategic and defence areas,” she said.

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