Why not let China build its EVs in Canada?

There is a certain inevitability to the onslaught of Chinese electric vehicles (EV).

- DAVID OLIVE

Chinese automakers account for more than half of global EV sales.

Chinese EVs have made significant inroads in Western Europe, South America, Mexico, the Middle East, Africa and Australia.

Ottawa signalled this week that it probably will impose tariffs on Chinese EVs, following the recent examples of the U.S. and the European Union (EU).

Chrystia Freeland, the federal finance minister, vowed on Monday that Canada won’t become a “dumping ground” for Chinese EVs.

But there’s a better way to address this issue than with that kind of brazen protectionism. More on that later.

Last month, the U.S. roughly quadrupled tariffs on Chinese EVs to as high as 102 per cent. The EU is planning surtaxes on Chinese EVs as high as 38 per cent. But the EU is negotiating with Chinese officials before imposing tariffs.

China is a major export market for EU goods including vehicles. The EU rightly worries about retaliation from China, which is already musing about higher tariffs on EU food imports. And Canada should think twice, as well, with about $22 billion a year in Canadian exports to a China at stake.

And logically, in time Ottawa would have to expand its tariff regime to Chinese EVs assembled in Mexico, Europe and Brazil.