China slaps up to 200% tariffs on Australian wine

Daniel Fowler
November 28, 2020

"If Australia really has sincerity in contact and dialogue with China, they should face up to the crux in the bilateral relationship, treat China and China's development objectively and rationally, and take China's concerns seriously, instead of harming China's national interests under the banner of safeguarding their own national interests and going further down the wrong path".

Starting Saturday, importers of Australian wine will be required to pay deposits to Chinese authorities.

China's Ministry of Commerce on Friday issued a preliminary ruling on an investigation into Australian wine, after China's drink industry accused Australian producers aof dumping wine into China at a discount rate, reducing the competitiveness of local producers.

Australia has consistently denied the allegations, with China's investigation not due to wrap up until next year.

Following the announcement on Friday, Treasury Wine Estates (TWE), one of the world's biggest winemakers saw its share price slump more than 13%.

"This latest hit by the Chinese government shows Beijing is determined to teach Australia a lesson that can reverberate globally", said John Blaxland, a former intelligence officer who's now a professor in worldwide security at the Australian National University.

"This led to the drastic deterioration of China-Australia relations and the hard situation we are now facing".

Agriculture Minister David Littleproud on Friday said Australia would not compromise it policy positions in response to trade threats.

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According to Zhao, the agreement was reached during the Chinese State Councilor and Foreign Minister Wang Yi's visit to Tokyo . China's position on this issue is clear, Wang said, and the country will continue to firmly safeguard its sovereignty.

China is the biggest buyer of Australian wine, importing A$1.2 billion ($880 million) in the year through September, according to government marketing body Wine Australia.

China's ministry of commerce said in August it would probe dumping - when a country sells goods in a country for less than it costs at home - throughout 2019, at the request of the Wine Industry Association of China.

The Chinese foreign ministry called on Australia last week to take unspecified action to improve relations.

Subsidiary Treasury Wine Estates Vintners is subject to duties as high as 169.3 per cent, according to the China commerce ministry statement.

Mr Birmingham on Friday said China's previous trade sanctions suggest the recent move is more about "other factors".

Australia has imposed restrictions meant to block foreign influence in its politics following complaints Beijing might be trying to manipulate its government. "We're a fair trading nation".

Australia's exports to China have boomed in the past few years, with the country rising to become the biggest importer of Australian wines in the world.

Ties between Beijing and Canberra have soured since April, when Australian Prime Minister Scott Morrison called for an independent inquiry into the origin of the coronavirus.

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