Canadian Prime Minister Carney and Chinese President Xi hold talks: Historic agreement on everything from taxes to visas

February 16, 2026

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Beijing: Canadian Prime Minister Mark Carney and Chinese President Xi Jinping reached an agreement on Friday in Beijing on a historic deal covering everything from trade to tourism to visa regulations.

Canadian Prime Minister Carney has praised Chinese officials for what he called a “historic agreement” under a “new strategic partnership” with China. The agreement will end years of diplomatic disputes, retaliatory arrests of each other’s citizens and disputes.

Carney has sought to reduce his country’s dependence on the United States, its major economic partner and traditional ally, after US President Donald Trump aggressively raised tariffs on Canadian products.

“Canada and China have reached a preliminary but historic trade agreement that will remove trade barriers and reduce tariff increases,” Carney said at a press conference after meeting with President Xi.

Under the agreement, China, Canada’s largest market for canola seeds, is expected to reduce tariffs on canola products to between 1 and 15 percent by March 1. It currently stands at around 84 percent.

Under the deal, China will allow Canadian visitors to enter without a visa. In return, Canada will import 49,000 Chinese electric vehicles (EVs) at a new preferential tariff of 6.1 percent.

“This is a return to the level that existed before the recent trade tensions,” Carney said of the EV agreement. Welcoming Prime Minister Carney at the Great Hall of the People, Chinese President Xi said, “Since the meeting between the leaders of the two countries on the sidelines of the APEC summit last October, China-Canada relations have reached a new important juncture.

President Xi told the Canadian leader, “Our meeting last year opened a new chapter in the direction of improvement in China-Canada relations.”

He said, “The healthy and stable development of China-Canada relations has served the common interests of our two countries.” He said he was pleased with the discussions that have taken place over the past few months to restore cooperation.

Relationship in the right direction

Relations between the two countries soured in 2018 after Canada arrested the daughter of Huawei’s founder following a US arrest warrant and China arrested two Canadians on espionage charges.

The two countries have imposed tariffs on each other’s exports in the years since, and China has also been accused of interfering in Canadian elections.

Canadian Prime Minister Carney has appeared to take the initiative to improve relations with China since his election, and Beijing has also said it is willing to put the relationship “on the right track.”

The Canadian leader, who met with Prime Minister Li Keqiang on Thursday, is also scheduled to hold talks with business representatives to discuss trade issues.

Canada, traditionally a staunch US ally, has been hit hard by Trump’s tariffs on steel, aluminium, vehicles and lumber, particularly in the face of the US’s increasingly aggressive stance towards China.

Washington’s move has prompted Canada to look elsewhere for business. In October, Carney said Canada should double its non-US exports by 2035 to reduce its dependence on the US.

The United States is Canada’s largest market, purchasing about 75 percent of Canadian goods in 2024, according to Canadian government data.

China is Canada’s second-largest market, purchasing less than four percent of Canada’s exports in 2024