SYDNEY/BEJING, April 11 (Portal) – Australia has reached an agreement with China to settle their dispute over barley imports, Foreign Secretary Penny Wong said on Tuesday in the latest sign of improving relations between the trading partners.
Relations between the two had been strained for years and soured after Australia called for an investigation into the origins of COVID, sparking trade reprisals by Beijing including anti-dumping duties on Australian wine and Australian barley.
But tensions have eased since the centre-left Labor Party came to power in Australia last year. Wong met her Chinese counterpart Wang Yi in Beijing in December, the first such visit by an Australian minister since 2019.
Chinese purchases of Australian coal resumed in January after nearly three years, and beef imports have accelerated.
Wong said Australia will stay a case at the World Trade Organization (WTO) over China’s anti-dumping and countervailing tariffs on barley, while China accelerates a review of the tariffs.
“China has agreed to conduct an accelerated review of Australian barley tariffs over a three-month period, which may extend to a fourth if necessary,” she told a news conference.
“In return, we have agreed to temporarily suspend the WTO dispute for the agreed review period.”
The government expects a similar outcome in a second dispute over wine tariffs, she added.
MUTUAL TRUST
China’s Commerce Ministry, which imposed the tariffs for a five-year period, did not respond to a request for comment.
“China stands ready to work with Australia … to advance the rebuilding of mutual trust between the two countries and put bilateral ties back on track,” Foreign Ministry spokesman Wang Wenbin said on Tuesday.
He did not comment on the agreement.
On Monday, China said Ma Zhaoxu, a deputy foreign minister, will visit Australia and Fiji this week to hold a new round of “political consultations.”
80.5% tariffs on Australian barley virtually wiped out grain imports from the world’s largest beer market, prompting Australia to file a formal complaint with the WTO in 2020.
By then, imports were between A$1.5 billion (US$1 billion) and A$2 billion per year.
Grain Producers Australia welcomed the move. “This process to reach a solution would be significantly shorter than if the WTO process were to continue,” Chair Barry Large said in a statement.
China’s tariffs on Australian barley caused its buyers to turn to Canada, France and other markets.
Barley prices have fallen since the beginning of the year, partly on hopes that Australia will resume imports.
“Everyone is waiting for Australian barley to come,” said Yang Zhenglong, General Manager at Malteurop China.
While most maltings in China already have enough stocks for this year, the resumption of trading in a few months would allow Australia’s new barley crop, which will be harvested from October, to reach China by the end of the year, he added.
($1=1.4990 Australian Dollars)
(This story has been corrected to show that the figures in paragraph 14 relate to imports and not duties.)
Reporting by Alasdair Pal in Sydney and Dominique Patton and Yew Lun Tian in Beijing; Edited by Clarence Fernandez and David Holmes
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Alasdair Pal