Can Canada and China repair their relationship?

Summary

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Podcast Summary: Marketplace Morning Report

Episode: Can Canada and China repair their relationship?

Date: January 16, 2026

Host: Guy Kilty (BBC World Service)
Guests: James Griffith (Asia correspondent, Globe and Mail), Sonja Mitchell (Jumpship Brewery), Martin Lodewijks (IWSR), Jonny Forsyth (Mintel)

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Main Theme

This episode centers on the newly announced strategic partnership between Canada and China, exploring its economic significance, political context, and the broader implications for both countries. The episode also briefly covers global oil market developments, a US-Taiwan trade deal, and the rising popularity of non-alcoholic drinks.

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Key Discussion Points & Insights

1. Canada-China Strategic Partnership Announcement

[00:32 – 04:00]

Overview:

• Canadian Prime Minister Mark Carney and Chinese leader Xi Jinping unveil a new trade and cooperation agreement in Beijing.
• The deal includes cooperation on clean energy and fossil fuels, lower import tariffs, energy investment, and tourism initiatives (visa-free access).

Key Details:

• Electric Vehicles: Canada will allow 49,000 Chinese electric vehicles (EVs) to be imported annually (similar quota as in 2023 before tariffs).
• Canola Seed: China will drop significant tariffs on Canadian canola and other agricultural products, expected to open a $7 billion market for Canadian producers.
• Investment: Initial mention of increased Chinese investment in Canada, likely targeting energy but specifics are not fully disclosed.
• Tourism: Visa-free access for Canadians traveling to China.

Impact & Significance:

• The agreement is seen as “fairly significant, especially from the Canadian perspective” (James Griffith, 01:50).
• Canada makes a “relatively small concession” (EV imports) in exchange for major market access for its canola exports.
• Represents a major thaw after nearly a decade of strained relations, especially in the aftermath of:
  • The “two Michaels” incident (detained Canadians in China in retaliation for the arrest of Huawei’s Meng Wanzhou).
  • Tit-for-tat tariffs and allegations of foreign interference during the Trudeau era.

Notable Quotes:

• James Griffith (01:50):
  “Mr. Carney has reached an agreement where Canada will accept 49,000 Chinese EVs, which was the same as they were accepting in 2023 before those tariffs came into force. And in return, China is dropping a lot of its tariffs on Canadian canola, which is a far more significant aspect or segment of Canada's economy.”
• James Griffith (03:01):
  “Mr. Carney said that the relationship has been distant and uncertain for nearly a decade. It really reached an incredible low point during the Trudeau administration ... So this has been a really, really tense relationship which has really hurt the economic relationship between the two countries.”

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2. Quick Global Markets and Trade Update

[04:01 – 05:06]

• Oil Prices:
  Oil prices dropped over 4% as tension eased regarding a possible U.S. attack on Iran. (Iran mainly exports oil to China.)
• U.S.-Taiwan Trade Deal:
  • New agreement will reduce import taxes on Taiwanese goods to the U.S. (from 20% to 15%).
  • In return, Taiwan commits $250 billion in investment in the U.S., mainly in technology.

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3. Trends in Non-Alcoholic Drinks & Dry January

[05:06 – 08:26]

On the Ground:

• Sonja Mitchell (Jumpship Brewery, Scotland) describes innovation in craft-brewing non-alcoholic beers.
• Growth in the alcohol-free sector, pioneered by craft producers, now includes major brands (e.g., AB InBev, Diageo, Pernod Ricard).

Market Trends:

• The rise in non-alcoholic beverages is due less to fad challenges like “Dry January” and more to:
  • Increased health consciousness among consumers.
  • Government campaigns against alcohol aiding this trend.

Industry Insights:

• Martin Lodewijks (IWSR):
  “The trend for non alk grew initially more in your developed markets... But over the last five years what's really changed is that you're now seeing really strong non alk growth coming out of emerging markets as well.” (06:00)

• Currently, non-alcoholic products make up about 1% of global drinks sales but are growing, with larger adoption in markets like Germany (~8.5% of beer sales).

• Jonny Forsyth (Mintel):

  • Campaigns like Dry January are less important than macro-trends toward health.
  • “Primarily those are consumers being much more conscious about their health and also governments realizing that drinking alcohol is problematic and puts a lot of pressure on their health systems and investing a lot of money in anti-drinks advertising.” (07:43)

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Notable Quotes & Memorable Moments

• James Griffith (Canada-China deal, 01:50):
  “Canada is accepting a relatively small amount of Chinese cars in return for China accepting a huge amount of Canadian canola seed.”

• James Griffith (on diplomatic relations, 03:01):
  “Mr. Carney said new strategic partnership is the language he's used. He's talking about not even a reset, but a completely kind of new pathway for Canada, China ties.”

• Sonja Mitchell (Jumpship Brewery, 06:46):
  “We brewed a few different versions. One was terrible, one was okay and one was brilliant. So everyone I shared this beer with loved it.”

• Jonny Forsyth (future of non-alcoholic drinks market, 08:06):
  “If we take a market like Germany, our figures show that it accounts for 8.5% of all alcoholic beer sales... what it does show is that this has got significantly more runway to go.”

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Timestamps for Important Segments

• 00:32 – 04:00: Canada-China partnership breakdown, historical tensions, and deal significance
• 04:01 – 05:06: Oil market movements, US-Taiwan trade deal overview
• 05:06 – 08:26: Non-alcoholic drinks innovation, market growth, and industry expert commentary

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Tone & Style

The episode features Marketplace’s trademark concise, fact-based reporting infused with insightful commentary. Guests and hosts provide candid and clear analysis, often using plain language and direct attribution to sources or official statements.

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Conclusion

This episode delivers a brisk but comprehensive update on a major turnaround in Canada-China trade relations, addresses shifting dynamics in global markets, and highlights broader consumer trends in health-conscious sectors. The information is accessible and engaging, making it a useful overview for listeners interested in global economics and business news.

Transcript

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[Guy Kilty]

Canada and China repair their relationship with a new trade deal Live from the UK this is the Marketplace Morning Report from the BBC World Service. I'm Guy Kilty. Good morning. Canadian Prime Minister Mark Carney and Chinese leader Xi Jinping have announced a new strategic partnership between the two countries in Beijing. The two sides have signed an agreement to cooperate on clean energy and fossil fuels and lower import tariffs on a range of products. James Griffith is Asia correspondent for the Canadian newspaper the Globe and Mail and has been following this story closely. James, thanks very much for joining us on Marketplace.

[James Griffith]

Thanks for having me.

[Guy Kilty]

So we now know that Canada and China have agreed a new strategic partnership. Just run us through some of the details.

[James Griffith]

Yes, so we just heard from Prime Minister Mark Carney at a press conference in Beijing where he outlined parts of the parts of this partnership which includes allowing 49,000 Chinese electric vehicles into Canada on the Chinese side, dropping a large number a large amount of tariffs on Canadian canola seed and some other agricultural products, and then also smaller deals on Chinese investment, which hasn't been completely outlined yet, but probably investment targeting the energy sector deals on tourism, including visa free access to Canadians to travel to China.

[Guy Kilty]

And how significant a deal is it for both sides?

[James Griffith]

It seems fairly significant, especially from the Canadian perspective. Mr. Carney's made a relatively small concession, which is Canada previously had a 100% tariff on Chinese EVs, which was copying a similar measure in the US that was adopted by the Trudeau government. And Mr. Carney has reached an agreement where Canada will accept 49,000 Chinese EVs, which was the same as they were accepting in 2023 before those tariffs came into force. And in return, China is dropping a lot of its tariffs on Canadian canality, which is a far more significant aspect or segment of Canada's economy. So Canada is accepting a relatively small amount of Chinese cars in return for China accepting a huge amount of Canadian canola seed. And Mr. Carney estimated probably $7 billion worth of Canadian canola seed. So as far as we can tell, in the very early digestion of this deal, Mr. Carney seems to have got a pretty good deal for Canada.

[Guy Kilty]

And it's a fairly big change for both sides, isn't it too? Because I think I'm right in saying that relations between the two countries haven't exactly been brilliant for the last few years.

[Jonny Forsyth]

No.

[James Griffith]

Speaking this afternoon, Mr. Carney said that the relationship has been distant and uncertain for nearly a decade. And it really reached incredible low point during the Trudeau administration where obviously there was the saga of the two Michaels when China imprisoned two Canadians in apparent retaliation for Canada arresting the Huawei executive Meng Wanzhou. And that dragged on for several years and really strained ties between the two countries. Then there was this trade war that broke out just towards the end of the Trudeau administration and long running tensions over alleged foreign interference by China in Canada. So this has been a really, really tense relationship which has really hurt the economic relationship between the two countries. And Mr. Carney said new strategic partnership is the language he's used. He's talking about not even a reset, but a completely kind of new pathway for Canada, China ties. It does seem to be a, it is a dramatic shift compared to only a year ago.

[Guy Kilty]

James, thanks very much for joining us on Marketplace.

[James Griffith]

Thanks for me.

[Guy Kilty]

Let's do the numbers. Oil prices fell more than 4% on Thursday as the threat of a U.S. attack on Iran appeared less likely. Iran produces about 3% of the world's oil and exports 2 million barrels of crude a day, almost all to China. The United States and Taiwan have reached a trade agreement that reduces import taxes on goods from the island while increasing Taiwan's technology investment in the U.S. washington's Commerce Department said tariffs on most Taiwanese goods will be lowered from 20 to 15%. In return, it says Taiwanese firms will invest $250 billion in the US festive celebrations at Christmas and New Year often involve increased alcohol consumption in many parts of the world. For some, that's followed by a decision to take a break from drinking, often known as dry January. However, data shows that more people are choosing to cut their alcohol intake all year round. Our reporter Imran Rahman Jones explores the growth in non alcoholic drinks.

[Sonja Mitchell]

It starts off there in the Mash Tun.

[Imran Rahman Jones]

We're at a brewery just outside Scotland's capital, Edinburgh, and founder Sonja Mitchell is explaining how her beer is made. But there's something different about the product here. It's brewed with almost no alcohol.

[Sonja Mitchell]

The Flavours are developing in the beer so we'll be tasting it as it goes along till it gets to the point where it's ready then to get packaged.

[Imran Rahman Jones]

Sonja's company Jumpship and many other brewers around the world have been gearing up for a big few weeks as the Dry January movement that's going a month without alcohol has grown in recent years while but increasingly people are choosing to reduce their alcohol all year round. According to global drinks industry research body IWSR, worldwide alcohol sales have been flat since 2019. Martin Lodewijks is their president and managing director.

[Martin Lodewijks]

The trend for non alk grew initially more in your developed markets. So in Europe, in the US and that sort of started even sort of 10, 15 years ago. But I think over the last five years what's really changed is that you're now seeing really strong non elk growth coming out of emerging markets as well.

[Imran Rahman Jones]

There are a couple of important points here though. The growth in sales varies quite dramatically depending on the country. And the second thing to note is.

[Martin Lodewijks]

Globally non Elk products are about 1% of the total industry.

[Imran Rahman Jones]

So it's a small but growing market. Good news for someone like Sonja Mitchell at Jumpship Brewery.

[Sonja Mitchell]

I couldn't see anyone else doing it and so I thought I'd have a go.

[Imran Rahman Jones]

How long did it take to get a good beer that tasted nice?

[Sonja Mitchell]

I worked with a professional brewer on the first recipe. We brewed a few different versions. One was terrible, one was okay and one was brilliant. So everyone I shared this beer with loved it. Which kind of gave me the confidence to take it the next step to scale commercially.

[Imran Rahman Jones]

The non alcoholic drinks market was pioneered by smaller craft producers. But in recent years the huge drinks companies have also got involved.

[Sonja Mitchell]

What did you expect from a 00.

[Imran Rahman Jones]

New Beefeater 000 alcohol Pernod Ricard launched alcohol free Beefeater. Gin giants AB InBev have released 0% versions of Corona and Budweiser beers. And Diageo says its Guinness 0.0 saw double digit growth in sales last year. Johnny Forsyth of Mintel, the global research agency, says his research shows campaigns such as Dry January are not the main reasons behind the rising growth in alcohol free drink sales.

[Jonny Forsyth]

It's really the kind of the bigger macro factors that have driven the growth of non alcoholic drinks. Primarily those are consumers being much more conscious about their health and also governments realizing that drinking alcohol is problematic and puts a lot of pressure on their health systems and investing a lot of money in anti drinks advertising.

[Imran Rahman Jones]

Forsyth thinks we have not seen the peak.

[Jonny Forsyth]

Yet if we take a market like Germany, our figures show that it accounts for 8.5% of all alcoholic beer sales. So that's quite a significant chunk. In many other markets, that'll be just around 1%. But what it does show is that this has got significantly more Runway to go.

[Guy Kilty]

Jonny Forsyth, principal strategist at Mintel Food and Drink, ending that report by Imran Rahman Jones in the UK I'm Guy Kilty with the Marketplace morning report from the BBC World Service.

[Kyle Rysdal]

Hey, everybody, it's Kyle Rysdal, the host of Marketplace. It has been a year since the fires here in Los Angeles and businesses that burned are still struggling.

[Hardware Store Owner]

You know, I won't lie. I've looked, I've looked at, you know, hey, maybe, maybe we move the storm. It just, it wouldn't be the same.

[Kyle Rysdal]

Hardware store on the ground reporting and what the year ahead has in store for business owners still recovering. Listen to Marketplace on your favorite podcast.

[Jonny Forsyth]

Apparently.