China’s wine probe a normal trade remedy move

DESPITE it coming at a time of increased tensions between China and Australia, the announcement by the Chinese Ministry of Commerce last week that it had begun an antidumping investigation into imports of wine from Australia, although it will be unwelcome news for Australian wine producers, should not be over-interpreted.

According to the Chinese Ministry of Commerce, the probe is a normal anti-dumping investigation that is being conducted at the request of the China Alcoholic Drinks Association on behalf of domestic wine producers.

China’s imports of Australian wine more than doubled to 12.08 million litres between 2015 and 2019, with the association claiming that Australian wine producers had cut their prices to take the market share from local companies.

The ministry has pledged that the investigation, which will look at imports of Australian wine in containers holding two litres or less last year and evaluate any damage done to the Chinese wine industry from 2015 to 2019, will be conducted in a fair and just manner in accordance with the law, taking into account the comments of Australian stakeholders.

Although the move comes after China decided to apply anti-dumping tariffs on Australian barley in May and to suspend beef imports from four Australian companies due to their violation of the agreed requirements, none of these developments are anything more than normal trade measures.

Nor should it be overlooked that this is only the second trade remedy investigation China has launched into Australian products, while Australia has launched more than 100 trade remedy investigations against Chinese products since the two countries established bilateral ties.

In recent years, Australia has been imposing a staggering amount of tariffs on some Chinese products, including iron and steel, aluminum and chemical products, which has not only harmed the interests of Australian consumers but also dampened Chinese companies’ enthusiasm for the Australian market.

Some Australian politicians and media seem to willfully ignore the fact that China has remained the largest source of exports to Australia in recent years. China’s demand for Australian beef accounts for about one-fourth of Australian’s beef exports, and last year about one-third of Australia’s wine exports was destined for China. Hence, to some extent, the antidumping investigation may serve to raise Australians’ awareness of the importance of bilateral cooperation in trade and other fields.

China has always attached great importance to bolstering sound economic ties with Australia; otherwise, it would not have tied the economic knot with Australia in the form of their 2015 free trade agreement. Canberra should know therefore that at the conclusion of the investigation, which could last up to 18 months, the final ruling will be objective, impartial and fair, and based on the merits of the case.