Australia’s response to China’s economic sanctions | World

01/04/2021 Business, Technology, Vietnam, World



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Relations between Australia and China have become strained after Canberra requested in April 2020 an independent investigation into the origin of the Covid-19 virus, banning Huawei from participating in Australia’s 5G network and participating. Juggle joint naval exercises with India, the United States and Japan after a 13-year absence.
At least 13 sectors of the Australian economy are already taxed, some restrictions or bans by China include: beef, coal, copper, cotton, lobster, sugar, wood, tourism, sex launches, wine, wheat and wool. China’s economic sanctions are estimated to cost Australian exporters between $ 2 billion and $ 4 billion in revenue, according to AFP.

“No need to lick Chinese heels”

However, by the end of the year, the overall Australian economy recovered somewhat and emerged from the recession brought on by the Covid pandemic, according to AFP. Australian companies are intensifying their search for new customers and markets in order not to go bankrupt and avoid dependence on China.

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For example, many Australian winemakers say they are looking for more reliable countries to do business with, such as the United States and countries in Europe and Asia. In an interview with ABC (Australia) on February 2, the CEO of Taylors Wines (Australia), Mr. Mitchell Taylor said: “I think the US market is much more stable because there is no political interference like in China.”

Furthermore, Mr. Bruce Tyrrell, founder of Australia’s leading spirits company, Tyrrell’s Wines, welcomed the promotion of market diversification to avoid dependence on China and emphasized: “We don’t need to lick China’s heels. . because that’s what Beijing wants us to do. “

The Australian government is also negotiating a free trade agreement with the UK and India to help alcohol exporters reduce their dependence on China. Earlier, a number of high-ranking Western officials declared their support for Australian wine after Beijing in December 2020 announced a tariff of 107-212% on Australian wine imported to China.

On the other hand, Australian Trade Minister Simon Birmingham announced on December 16, 2020 that Canberra will formally submit a complaint to the World Trade Organization (WTO) requesting an investigation of the 80.5% anti-dumping tax rate. from China for Australian barley within 5 years.

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Reuters cited sources who revealed that the Australian government will prepare many options to support farmers because the complaint was expected to last for several years. Australian barley farmers started growing other grains or headed to the Middle East. And Australian cotton exporters are trying to expand markets to Vietnam, Thailand and other Asian countries, according to Reuters.

Develop the domestic market

In addition to seeking new markets, some sectors such as the lobster export industry promote the development of the domestic market, receiving support from both the Australian population and local authorities, according to AFP.

Specifically, the Western Australian state government changed the law, allowing fishermen to sell lobsters directly to people in port in large quantities in December 2020 and January. The local population responded enthusiastically and helped the fishermen. Overcome difficulties after Beijing imposed a near-complete ban on Australian lobster imports.

Before the Covid-19 epidemic, the highest lobster price was $ 80 (1.8 million VND) / kg in Western Australia and averaged about $ 53 / kg. In an effort to develop the domestic market, the price of lobster was reduced by 36% to $ 34 / kg. This leads to “out of stock”, forcing many supermarkets in Australia to limit the number of purchases per customer.

However, this is only considered a temporary fix and Australian fishermen are still looking to expand lobster exports to other potential markets such as Japan, the United States and Europe rather than relying solely on China.

China is Australia’s largest trading partner, accounting for 39.4% of goods exports and 17.6% of services exports between 2019 and 2020, according to research firm Capital Economics (UK). According to expert Marcel Thieliant of Capital Economics, economic growth in Australia could be reduced by as much as 2.8% if Beijing continues to increase tariffs on imported products from Australia.

However, in an article on The Conversation page, China expert James Laurenceson from the University of Technology in Sydney (Australia) assessed that China’s “psychological warfare” sanctions have an inherent political motivation and can only have an impact. in the short term, causing temporary problems for Australian companies, so “we must not panic”. In the long term, China will suffer more damage because Australian companies have created a stable market elsewhere, according to Laurenceson.




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