Chinese ministers ‘want tariff thaw’, says Murray Watt

Agriculture Minister Murray Watt says Chinese ministry officials are showing a ‘sincere desire for co-operation’ to break down punitive tariffs and strengthen agricultural collaboration.

Agriculture Minister Murray Watt. Picture: Getty Images

Agriculture Minister Murray Watt says Chinese ministry officials are showing a “sincere desire for co-operation” to break down punitive tariffs on Australian wine and strengthen agricultural collaboration following high-level talks in Canberra.

In a sign of further thawing in relations between Beijing and Canberra, Senator Watt on Monday met Chinese Agriculture Vice-Minister Ma Youxiang in Canberra to discuss ongoing trade disputes following a request from the Chinese ministry.

Mr Ma also toured Australian winery Clonakilla and sampled wines with Australian Grape and Wine chief executive Lee McLean, and both expressed a desire to strengthen partnerships between the two countries, a move likely to encourage domestic producers.

The meetings came after a major breakthrough in China-Australia trade disputes, with Australia temporarily suspending World Trade Organisation action and giving Beijing four months to lift its ban on barley exports. The deal being seen as fast-tracking a resolution in a test case that could provide a template for the removal of Chinese sanctions on other goods including wine.

Senator Watt told The Australian the meeting was a “positive step forward” in stabilising relations, with Mr Ma recognising there was a strong demand for Australian wine in China.

“I made the point that … we saw the negotiations around barley as a positive step and there was certainly interest from producers of other commodities in seeing other progress there, particularly wine, all of that was well received,” Senator Watt said. “I definitely felt there was a sincere desire for co-operation and to move forward and deal with some of those trade impediments that have been in place for a while.”

“Vice-Minister Youxiang … recognised that there has traditionally been a great appetite for Australian wine in China and I made the point that just as we have made some positive steps forward with barley, we would be keen to see something similar in relation to wine.

“I recognise that China has been a very important market for Australian wine producers and there was great interest among wine producers in that market being reopened.”

Australian grape growers were plunged into crisis in 2020 after Beijing slapped tariffs of up to 218 per cent on domestic bottled wine imports, effectively slashing the $1.3bn industry by 99 per cent.

Wine exports to China plummeted to just over $12m last year, forcing local producers to scramble to find new markets.

Senator Watt said the meeting “set up a pathway” for further co-operation, and that both officials recognised how restoring agricultural trading relationships could benefit the relationship more broadly.

The meeting came one week after high-level meetings between Vice-Minister for Foreign Affairs Ma Zhaoxu and Department of Foreign Affairs secretary Jan Adams in Canberra last week.

“Both the Vice-Minister and I recognise that agriculture has been a really key part of the trading relationship and the bilateral relationship more broadly, and if we can find avenues for co-operation and improving trade flows in agriculture then that will benefit the relationship more broadly,” Senator Watt said.

Following a tour of the Murrumbateman winery, where Mr Ma sampled some Australian wines with industry leaders, Mr McLean said the meeting was another signal of the relationship “heading in the right direction” and he was hopeful thawing relations would soon see Australian wine sold again in China.

“At the winery we focused on the production of wine, we didn’t get into anything specific but both expressed a desire to continue to build the relationship and strengthen it,” he said.

Senator Watt recently wrote to Chinese counterpart Tang Renjian to congratulate him on his reappointment and hopes to have a face-to-face meeting with him later this year.