Chinese government ramps up trade war in move that could threaten billion dollar wine industry
Victoria’s $175 million wine export industry is at risk after China launched an anti-dumping investigation in what’s being called a “disappointing and perplexing” move by the federal government. Here’s why.
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Victoria’s $175 million annual wine export industry is at risk after China launched an anti-dumping investigation in a move labelled “disappointing and perplexing” by the federal government.
The announcement marked a further escalation of the tensions between Beijing and Canberra – one that could cost Victorian producers already hard hit by the coronavirus recession.
Trade Minister Simon Birmingham said Australia would “strongly argue” the case there are no grounds for China’s claims that Australian wine is being unfairly dumped into their market. “This is a very disappointing and perplexing development,” Mr Birmingham said.
“Our wine industry has worked incredibly hard to establish itself as a world-leading producer and export powerhouse.
“Australian wine is not sold at below-market prices and exports are not subsidised.”
The government was formally notified of China’s anti-dumping investigation into wines imported from Australia on Tuesday.
It is understood China is also considering launching a countervailing duties investigation into whether Australian wine exports are receiving and benefiting from government subsidies.
Wine exports to China accounted for more than $1 billion last financial year, making up almost 40 per cent of Australia’s total wine exports.
Victoria’s exports alone brought $175 million into the state in the 12 months to July.
Mr Birmingham confirmed he had not been able to make contact with his Chinese counterparts in months, describing the state of communication as “disappointing”.
“Australia is certainly not engaging in any type of war,” Mr Birmingham said.
“What we want is a constructive trading relationship, one where we can work together in the areas of mutual interest.”
Peak body Australian Grape and Wine said exporters would fully co-operate with the inquiry, noting the importance of the market for the viability of the industry.
“China is an important market for Australian wine and our wine is in demand from Chinese consumers,” a spokeswoman said.
“The Australian industry welcomes the opportunity to build on these ties and work with the Chinese industry and government to further technical co-operation and develop lasting relationships.”
Tensions have been building between China and Australia since the start of the pandemic when Scott Morrison announced he would support an inquiry into the origins of the virus.
China has since slapped an 80 per cent tariff on Australian barley exports after a similar anti-dumping investigation.
The wine export probe could be finished as early as August next year.
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