Canberra’s trade ties with Beijing have the potential to return to normal if China removes the remaining restrictions, according to Tim Ayres, Australia’s assistant minister for trade. The two sides are currently engaged in discussions regarding this matter, and there has been some progress with Beijing lifting tariffs on Australian barley imports.
The tensions between Australia and China have been escalating since 2018 when Australia prohibited Chinese vendors from participating in its 5G rollout and blocked Chinese investments due to concerns about national security. The situation worsened in 2020 when Australia called for an international inquiry into the origins of the COVID-19 pandemic. This move triggered retaliatory measures from Beijing, including anti-dumping duties on Australian wine and barley.
Assistant Minister Ayres expressed his desire for trade with China to return to normal and stabilize across all sectors. He emphasized that until all obstacles are removed, it cannot be claimed that trade is back to its pre-conflict level. In 2020, Beijing progressively imposed import tariffs on various Australian goods, such as wine, red meat, lobsters, and timber. The tariff on Australian barley was increased by 80.5%, leading to a significant decline in bilateral trade valued at nearly $1 billion annually. In April, Australia agreed to temporarily suspend its complaint against China at the World Trade Organization, and China responded by lifting tariffs on Australian barley imports.
Currently, Canberra is urging Beijing to eliminate the tariffs on Australian wine imports that were introduced in March 2021, Ayres revealed.
The assistant minister stressed that prolonging these impediments is not in the interest of Chinese businesses. He argued that confidence in a rules-based approach to trade is necessary, and the upcoming meeting offers an opportunity to emphasize the need for further progress.
Apart from the trade conflicts, tensions between the two nations have also been fueled by various other issues. These include disagreements over Taiwan, a trade dispute concerning coal exports, and Australia’s involvement in the trilateral AUKUS defense pact with the United States and the United Kingdom, which grants Australia access to nuclear-powered submarines.
It is essential for both countries to find a resolution to restore their trade relationship and create an atmosphere of mutual trust and cooperation. Removing the remaining restrictions would contribute to stability and growth in bilateral trade. By fostering an environment that promotes a rules-based approach to trade, both Australia and China can benefit from strengthened economic ties.