Signs China may pull back on punishing Australian trade bans

China has acknowledged concerns over its bid to join the Trans-Pacific free trade agreement in a fresh sign it is preparing to ease its punishing trade bans against Australian exports.

Trade Minister Don Farrell gives Chinese Commerce Minister Wang Wentao a bottle of his ‘Godfather Too’ Shiraz after their high-level talks on Friday night.

China has acknowledged concerns over its bid to join the trans-Pacific free trade agreement in a fresh sign it is preparing to ease its punishing trade bans against Australian exports.

The Australian can reveal Chinese Commerce Minister Wang Wentao “noted” the publicly-raised concerns by Australia and Japan during his Friday meeting with Trade Minister Don Farrell, which threaten to scuttle its application to join the high-standard trading bloc.

While Mr Wentao did not agree to address the concerns, Australian officials took the statement as a positive signal that Beijing knows it needs to pull back on its economic coercion of trading partners.

The Chinese Foreign Ministry said “substantial progress” had been made during Mr Wang and Senator Farrell’s meeting in Beijing, and China was willing to work towards “more positive results” in stabilising bilateral trade ties.

The declaration came as Foreign Minister Penny Wong announced the appointment of former ASIO director-general Duncan Lewis to the board of the National Foundation for Australia-China Relations.

The move reflects the government’s determination to have strong national security voices on the key advisory body.

In his meeting with Senator Farrell, Mr Wentao pushed for improved investment access for Chinese firms in key areas, including critical minerals, and raised concerns over Australia’s anti-dumping case in the World Trade Organisation against Chinese steel.

The ministers went “line by line” through China’s $20bn worth of trade bans on Australian exports, and Mr Wang noted Senator Farrell’s appeal for Beijing to free jailed Australian citizens Cheng Lei and Yang Hengjun.

Senator Farrell was firm with his host on Chinese trade bans against $1.2bn worth of Australian wine, saying he expected the sanctions to be reviewed in the same way as Beijing was reassessing its treatment of Australian barley.

Australia hopes to have confirmation within the next six weeks on the hoped-for review of wine tariffs, ahead of a looming World Trade Organisation report on the dispute.

The 11-member Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or TPP-11, imposes the highest standards of all global free trade deals.

It requires high-levels of transparency and intellectual property protection, and bans members from imposing local data storage rules that could compromise the security of foreign companies’ information – all of which China would struggle to deliver.

China slapped punishing tariffs on Australian exports in 2020, including barley, wine, beef, lobster, coal and timber, after the Morrison government called for an inquiry into the origins of Covid-19.

Opposition foreign affairs spokesman Simon Birmingham. Picture: NCA NewsWire/Gary Ramage

Australian officials cited headway on coal, copper concentrates and cotton after a virtual meeting between the ministers in February, saying it was hoped a “similar pattern” of progress would occur following the latest talks.

The federal government wants all of the trade bans to be lifted and the detained Australians to be released ahead of a likely trip to China by Anthony Albanese in late October or early November.

Opposition foreign affairs spokesman Simon Birmingham expressed “deep disappointment” the Trade Minister’s trip failed to deliver relief “from China’s punitive, unfair, and illegal trade sanctions on Australia exports”.

But Senator Farrell said the meeting represented an important step forward.

“I achieved what I came here for – to find a pathway to resolve the remaining trade impediments,” he said.

In a weekend statement issued after the meeting, the Chinese Commerce Ministry said Beijing was prepared to work with Australia on resolving the nations’ trade disputes. But it warned China also expected Australia to give ground.