Prime Minister Mark Carney says Canada is entering a new era in its relationship with China, as his first official visit to Beijing focuses on reopening dialogue after years of strained ties. Markets are watching for signs of normalization rather than sweeping trade breakthroughs.
BNN Bloomberg spoke with Christine Tan, portfolio manager at SLGI Asset Management, about early market reaction, the role of energy and agriculture in Canada-China talks, and how investors are balancing geopolitical risk against a still-supportive earnings backdrop.
Key Takeaways
- Carney’s China visit is centred on restoring communication and setting a foundation for cooperation, with memorandums of understanding signalling intent rather than binding trade outcomes.
- Energy stands out as a potential beneficiary, with China already a buyer of Canadian heavy crude via TMX and diversification becoming more important as global supply shifts.
- Agriculture remains a key pressure point, as canola tariffs linked to Canada’s EV policies could meaningfully affect farm incomes and related sectors if eased.
- Markets are treating China developments cautiously, pricing in incremental progress while remaining focused on earnings, valuations and broader macro risks.
- Despite geopolitical uncertainty, corporate fundamentals remain supportive, though elevated valuations leave little room for disappointment if risks escalate.
Read the full transcript below:
ROGER: Prime Minister Mark Carney says Canada is entering a new era of relations with China, and that his visit to Beijing sets the stage for talks on areas where the two can be strategic partners. Let’s get more on this and the markets from Christine Tan, portfolio manager at SLGI Asset Management. Christine, thanks, as always, for joining us.
CHRISTINE: Good morning, Roger. Thanks for having me — although I’m remote today because of all the snow.
ROGER: I think we’re remote here, too. I think we’re just trapped with the snow we’re getting in Toronto.
CHRISTINE: Oh dear.
ROGER: China, though — it’s nothing that looks like blue skies and lollipops so far. Your thoughts on what’s unfolding there?
CHRISTINE: You know, I think our expectations were that if we got any announcements, they would come toward the end of the week. Carney has met with Premier Li, but the big meeting is really later today — which would be Friday in China — with President Xi.
So it was a bit of a pleasant surprise that we did see some MOUs come out overnight. Now, the key is that these are memorandums of understanding. They’re not contracts. But they do cover some key areas of potential collaboration.
For example, energy — more specifically clean energy — as well as cultural exchange, tourism and forestry management. I think of these more as knowledge exchange initiatives that could potentially lead the way toward actual flows of goods. But it’s early stages.
Our base case was really just normalization and a reopening of communication channels. China used to be basically our second-largest trading partner after the U.S. The U.S. continues to be a very important partner, obviously, but it behooves both Canada and the U.S. to diversify and think more broadly.
ROGER: And how is the market approaching China with all these talks going on? Do they see opportunity, or is there concern?
CHRISTINE: It’s a great question, Roger, and it really depends on who you ask. For us, if you think about the TSX specifically, sectors that could benefit from easing trade include energy.
As you know, the Trans Mountain pipeline was expanded. It took quite a few years, and the government had to get directly involved. But TMX is fully up and running and operational as of 2024. China is already one of the biggest buyers of diluted bitumen that runs through TMX.
There is also incremental volume that could theoretically move to the Chinese refinery market. I bring that up because, with the potential increase in heavy production out of Venezuela, some of our heavy barrels going to Gulf of Mexico refineries could be replaced over the medium term. So again, it’s about diversification.
The other key area is canola. China currently has 100 per cent tariffs on Canadian canola, largely in response to Canada’s tariffs on Chinese EVs. If you really drill down, that canola-auto-EV discussion could be quite meaningful for the Canadian economy.
ROGER: That’s everything. I mean, the EV side will be interesting. Backing off tariffs with Trump next door is a tough call. But with canola, we’re already seeing nutrient stocks reacting. This could really fuel it, couldn’t it?
CHRISTINE: It really could. And remember, Canada is also one of the largest exporters of potash in the world. While there aren’t direct tariffs there, agriculture is an area where trade could expand.
When we think about sectors that matter most for Canada in these discussions, it’s autos, agriculture, lumber and energy. So far, the discussion has been more around clean energy.
China has been leading globally in solar and wind adoption, partly because of its scale. They’ve developed technology that Canada could potentially learn from or leverage as we rethink our role as a global energy superpower.
Carney has talked about that — embracing traditional hydrocarbons like oil and gas from Alberta, which remain a key growth area, alongside alternative energy.
ROGER: And, of course, we have to balance all of this with what’s happening in the U.S., which is still our biggest trading partner. How are things looking as we head into the year for Canada more broadly?
CHRISTINE: You know, Roger, if you’d told me I’d be starting 2026 with some of the headlines we’ve seen, I would have expected the bond market to react more — whether to Fed noise or oil-market developments — and we really haven’t seen that.
Markets may be getting used to a lot of news. As earnings season kicks off in the U.S., the focus shifts to what actually affects company earnings. Canada tends to lag a bit on timing.
For now, strong earnings — like what we saw from TSMC overnight — are keeping markets supported. What concerns us is complacency. Any earnings miss or pickup in geopolitical risk could create volatility. Markets have been very strong year to date, which doesn’t leave much room for error.
That said, we’re cautiously optimistic. Fundamentally, the earnings outlook looks favourable across the S&P 500, the TSX and even emerging markets. Corporate balance sheets are resilient. Our main concern is valuations, particularly in parts of the S&P 500 and global tech. But overall, the fundamentals still look OK.
ROGER: We’ll leave it there on a cautiously happy note. Christine, thanks very much for joining us.
CHRISTINE: Thanks, Roger.
ROGER: Christine Tan, portfolio manager at SLGI Asset Management.
---
This BNN Bloomberg summary and transcript of the Jan. 15, 2026 interview with Christine Tan are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
