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The increase in the price of iron ore offsets the damage of Chinese tariffs to Australia Image: Wikipedia / Copyright regulation: CC BY-SA 2.0 br
China imposes high tariffs on Australian wine, beef, barley, lobster and charcoal, in an attempt to seriously damage the other party’s economy and force the other party to make concessions. However, an analysis by Deloitte Access Economics shows that losses caused by trade tensions between Australia and China have been offset by rising iron ore prices, and the budget deficit announced by the Australian government will be lower than expected. originally planned.
The Guardian reported that Chris Richardson, partner and chief economist at the Deloitte Institute for Economic Research, noted that due to concerns that China might consider taking certain action against Australian iron ore, causing market panic, Australia Since 30 November, the spot price of iron ore has risen sharply, to $ 18 a tonne.
Richardson noted that in addition to being concerned about China’s actions on Australian iron ore, the market is also concerned that heavy rains could restrict supply from Brazil, and that extremely low interest rates and the depreciation of the dollar also raise the price. price of iron ore.
The Deloitte Institute of Economic Research noted that the Australian economy has performed better than expected and that wage subsidies have also been reduced. The deficit for 2020-21 may be US $ 3 billion less than the US $ 213.7 billion forecast in the October budget. By 2023-24, the Australian economy will improve even more.
Deloitte noted that tariffs and other business practices can harm both countries and cause losses to Chinese families while affecting Australian companies.
Richardson said: “China knows that the most dangerous place is iron ore.”
“China is a major customer in the world and Australia is a major supplier in the world. So analysts believe that China will not take action against Australian iron ore because it will cost them a lot. However, the market remains I am concerned that China take action. “
China imposes high tariffs on Australian wine, beef, barley, lobster and charcoal, in an attempt to seriously damage the other party’s economy and force the other party to make concessions. However, an analysis by Deloitte Access Economics shows that losses caused by trade tensions between Australia and China have been offset by rising iron ore prices, and the budget deficit announced by the Australian government will be lower than expected. originally planned.
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