The next Aussie export to face China trade attack
China could slap new tariffs on Australian wine as early as Sunday, as Australia’s $1.1 billion cotton exports are the latest to be targeted by unofficial restrictions from Beijing.
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China could slap new tariffs on Australian wine as early as Sunday, as Australia’s $1.1 billion cotton exports are the latest to be targeted by Beijing.
The emerging super power has seemingly pivoted towards more covert trade barbs, as the tensions with Canberra continue to escalate.
The cotton industry has joined coal this week in being subject to claims on unofficial bans or restrictions.
It prompted strong reaction from Trade Minister Simon Birmingham, who demanded China rule out any discriminatory action against Australian cotton producers – warning it could be a breach of international trade rules.
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The cotton restrictions are compounding existing trade action China has already taken against beef, barley, wine, as well as threats to tourism and international student industries when travel reopens.
Analysis of Department of Foreign Affairs and Trade data shows there has been about a $2 billion drop in trade with China across beef, barley, cotton and coal in the calendar year to August, when compared to the first eight months of last year.
But it remains difficult to say how much of that is related to trade tensions and how much is COVID-19.
Cotton Australian CEO Adam Kay said it had become clear China was discouraging their mills from using Australian cotton, which he described as “disappointing”.
“Our industry’s relationship with China is of importance to us and is a relationship we have long valued and respected,” he said.
“Despite these changes to our industry’s export conditions, we know Australian cotton will find a home in the international market.”
It will be 60 days on Sunday since China launched its investigation into claims of dumping and subsidies against Australian wine, which is the first opportunity it has to impose tariffs under World Trade Organisation rules.
Australian Wine and Grape boss Tony Battaglene said the industry remained hopeful that this would not happen.
“We don’t think we have a case to answer,” he said.
“We’re trying to do all the right things. We know there’s support in China for our wine sector, we just have to let it play out.”
Senator Birmingham said China should rule out any use of discriminatory actions against Australian cotton producers.
“Impeding the ability of producers to compete on a level-playing field could constitute a potential breach of China’s international undertakings, which would be taken very seriously by Australia,” he said.
