Following the first visit by a Chinese foreign minister to Australia since 2017, export surcharges on Australian wine have been removed. This announcement marks a further step towards thawing diplomatic relations between the two countries.
The Chinese foreign minister’s visit to Australia led to the end of extra tariffs on Australian wine on March 29, marking an improvement in the relations between China and Australia.
Wang Yi visited Australia on March 20 to attend the 7th Australia-China Strategic and Foreign Dialogue, a meeting with, among others, its Australian counterpart, Penny Wong, enabling the two countries to agree on a strategic and commercial partnership.
Wang Yi also took advantage of his presence in Australia to take part in a private Australia China Business Council round table with leading Australian exporters to China.
These meetings made Mr. Yi the first Chinese Foreign Minister to visit Australia since 2017, marking a thaw in relations between the two countries. Indeed, until last year, Australia and China were at loggerheads.
Their relations began to deteriorate in 2018 and then in 2019 following Australia’s decision to withdraw Chinese giant Huawei from its 5G coverage on national security grounds, and then by the joint request for an investigation into the origins of COVID-19 from the United States and Australia.
Sino-Australian trade relations had deteriorated with the installation of restrictive measures by China on Australian exports, such as up to 218% in the case of wine. China is Australia’s biggest trading partner, with the Chinese market bringing in 1.2 billion Australian dollars (782 million dollars) for Australia in 2019, and these taxes have resulted in the wine sector losing around 20 million dollars in 2020 alone.
But relations between the two countries became more cordial following the visit of Australia’s new Prime Minister, Anthony Albanese, to China last year. In return, his Chinese counterpart, Li Qiang, is due to visit Australia later this year.
Wang Yi’s announcement that most taxes on wine, beef and lobster would be lifted has delighted Australian winemakers and other export industries. The surtax on Australian wines in China ends on March 29. China’s Premier, Li Qiang, also expressed his willingness to ease tariff barriers and support foreign investors last Sunday.
In a statement, the Australian prime minister, the Australian minister for foreign affairs and the Australian minister for trade, Don Farell, said: “The removal of duties means that Australia will discontinue its legal proceedings at the World Trade Organization.”
This attempt to open up the Chinese market is seen as a response to China’s slowing economic growth.
