Canada’s toughening stance on China has driven another miner out of the country.
What happened: Canada-based miner Solaris is moving its headquarters from Vancouver to Ecuador after Canada’s stringent foreign investment standards got in the way of a $130 million investment from a Chinese company, making it the second miner to leave this year.
- Ottawa has made it harder for foreign firms to invest in Canadian companies that produce minerals used in electric vehicle batteries, like lithium, graphite, and copper.
Why it matters: There’s a fine line between protecting national security and harming the Canadian economy. Earlier this week, Bank of Canada Governor Tiff Macklem warned that these risks should be mitigated but not become a “pretext for inefficient protectionism.”
- From tariffs on China-made EVs to restricting investments in critical minerals, it’s a tough balance to strike in sectors that have become reliant on Chinese investments.
Zoom out: This week, Ottawa also announced it’s considering a surtax on critical minerals, batteries, solar products, and semiconductors sourced from China — a move that would escalate the tit-for-tat trade spat with Canada’s second-largest trading partner.—LA