China has issued a strong warning of countermeasures following US President Donald Trump's decision to impose 25% tariffs on countries trading with Iran. The announcement has sent shockwaves through Beijing, particularly given China's position as the largest buyer of Iranian oil and its significant investments in the region.

China's Official Response

Chinese Foreign Ministry spokesperson Mao Ning responded firmly to Trump's threat, stating that "there are no winners in a tariff war, and China will firmly safeguard its own legitimate and lawful rights and interests." The announcement has prompted concerns in Beijing about potential disruption to its cheaper oil import arrangements and broader strategic interests.

Impact on China's Energy Strategy

The tariff threat poses significant challenges to China's energy security and investment portfolio. According to intelligence firm Kpler data, China's energy exposure to sanctioned countries is substantial:

Broader Strategic Implications

China faces compounding challenges beyond the Iran tariff threat. The fall of Venezuelan President Nicolas Maduro has eliminated a key ally and disrupted oil supply arrangements. China had invested over $106.00 billion in Venezuela, and Maduro's fall brought an overnight end to Venezuela's allegiance to Beijing.

Trump's aggressive strategy to re-establish US dominance in Latin America threatens Chinese investments across multiple countries, including Panama and Venezuela, while also posing threats to Cuba.

Economic Assessment

Experts warn of significant economic consequences for China. Rajiv Biswas, chief executive officer of Singapore-based research firm Asia-Pacific Economics, noted that "the economic impact on China could be significant, as the new 25% tariff would likely be cumulative on top of existing US tariffs on China's exports to the US."

The actual impact will depend on whether China decides to curtail trade with Iran, according to Biswas. This decision will require Beijing to balance its energy security needs against potential economic penalties.

Strategic Recalibration

Analysts suggest China is redrawing its energy and investment strategy in response to these challenges. James Downes, co-director of Italian think tank the Centre for Research and Social Progress, indicated that China may lean more toward the Persian Gulf if Iranian unrest and overall volatility continue.

Liang Yan, a professor of economics at Willamette University, characterized the secondary sanctions on Iran as a wake-up call for Beijing. "From Venezuela to Panama, now to Iran, China has more at stake in this than otherwise thought previously," she said, emphasizing that China will need to think more strategically about protecting its overseas assets and investments while building international relations.

Canadian Prime Minister Mark Carney is embarking on a significant diplomatic mission to China on Tuesday, January 13, marking the first visit by a Canadian prime minister to Beijing since 2017. The January 14-17 visit represents a potential turning point in Canada-China relations as Ottawa seeks to diversify its trade partnerships amid growing tensions with the United States under President Donald Trump.

Trade Deals and Economic Cooperation

The visit is expected to yield concrete results beyond symbolic diplomacy, with senior Canadian officials indicating that Carney will sign several memoranda currently under discussion. Greg MacEachern, a former senior Liberal ministerial adviser, emphasized that when a Prime Minister is invited to China, "it is not for window dressing."

Canola Trade Dispute Resolution

A major focus of the discussions will be the resolution of the canola trade dispute that has severely impacted Canadian agricultural exports. China announced preliminary anti-dumping duties on Canadian canola imports in August, escalating a year-long trade dispute that began with Ottawa's imposition of tariffs on Chinese electric vehicle imports.

The Chinese tariffs have virtually eliminated all canola exports to China, which was previously the biggest export market for Canadian canola. Colin Hornby, head of the Manitoba farm group Keystone Agricultural Producers, expressed optimism that while an agreement might not be reached during the trip, progress could occur in the coming weeks or months.

Strategic Considerations and Challenges

The visit carries political risks, particularly regarding potential reactions from Washington. However, the Canadian government has calculated that diversifying trade relationships is worth the risk. Doug Ford, premier of Ontario, urged Carney not to "back down," suggesting that EV tariffs should only be lifted if China opens a manufacturing facility in Ontario.

Diplomatic Context and Expectations

The visit stems from an agreement made in October when Carney and Chinese President Xi Jinping met in South Korea. This encounter suggested potential for deeper ties after a fractious relationship under former Prime Minister Justin Trudeau, which had soured following Canada's arrest of Huawei's chief financial officer in 2018.

China plans to welcome Carney at Beijing's Great Hall of the People, the country's grandest government building, which experts interpret as part of a "charm offensive." The Chinese foreign ministry has expressed that China looks forward to deepening mutual trust with Canada during the visit.

Lynette Ong, a professor of Chinese politics at the University of Toronto, noted that "both Canada and China want to signal their good intentions, so they each need to give away something." The visit represents a strategic recalibration as Canada navigates complex geopolitical relationships while seeking to expand its economic partnerships beyond traditional allies.