According to the Observer, Australian media disclosed that the WTO ruled on March 26 that Australia's anti-dumping practices on Huafeng Tower, railway hubs and stainless steel tanks violated WTO rules and regulations and should be revoked. In the relevant report, the WTO ruled that the tariffs imposed by Australia on Chinese products in 2014, 2015 and 2019 had technical problems that violated WTO regulations. Australian Trade Minister Farrell said in a statement that Australia accepts the WTO ruling and will contact China to implement the WTO proposal. The tariffs imposed by Australia on Chinese wind towers, stainless steel sinks and railway wheels are 10.9%, 17.4% and 60.2%, respectively, and China filed a lawsuit in June 2021.
The WTO recently ruled in favor of China, and the Australian side said that it accepted the ruling, which means that this long-lasting Sino-Australian trade dispute has come to an end. Ten days before the WTO ruling was issued, Australia announced on March 15 that it would cancel its anti-dumping measures against China's wind tower, indicating that Australia may have judged the outcome of the WTO ruling at that time and took measures to ease the trade atmosphere between China and Australia. After the WTO ruling was released and accepted by the Australian side, on March 28, China's Ministry of Commerce announced the termination of anti-dumping duties and countervailing duties on Australian wine from March 29.
According to the announcement, due to the changes in the pattern of China's wine industry, there is no need to impose a double anti-tax on Australian wine. Australian wine exports to China amounted to about US$1.1 billion in 2019-2020, and have since shrunk as the Australian Morrison government cooperates with the United States to contain China. China imposed anti-dumping duties on Australian wine for a period of five years from 28 March 2021. On November 30, 2023, the Ministry of Commerce of China initiated a review at the request of the Australian side. On March 29, 2024, China terminated the anti-dumping tax on Australian wine.
Australian Prime Minister Anthony Albanese said that China's termination of relevant restrictions has allowed Australian wine to re-enter the Chinese market, which is good for Australian producers and Chinese consumers. After the Chinese side lifts the restrictions, the Australian side will also terminate the litigation against China at the WTO. As a non-rigid industry, wine has a wide range of alternative products, and it is relatively difficult to find incremental markets, which also makes China's restrictive measures particularly lethal to the Australian wine industry. Since March 28, 2021, China has imposed a tax rate of 116.2% to 218.4% on Australian wines, and before that, Australian wines in China enjoyed zero tariff treatment. From zero tariffs to tariffs exceeding 100%, the Australian wine market in China has been hit hard, and about 40% of the market share of wine imported from China has continued to shrink.
According to data from the Australian Wine Association, between June 2022 and June 2023, Australia's wine exports to China were 8.1 million Australian dollars, which is not in the same order of magnitude as the 1.1 billion US dollars in 2019-2020. The number of dealers engaged in export business to China shrank from 2,382 to 115. After Australian wine was shut out of the Chinese market, the relevant gap was filled by other import sources, and China's local wine industry developed. The barriers to the re-entry of Australian wines into the Chinese market have been removed, but the market situation is significantly different from 2019.
At present, due to the impact of geopolitical conflicts, supply chain crises and economic recessions on traditional wine consumption markets such as the European Union, Japan, South Korea, and the United States, the wine industry is sluggish. The reopening of the Chinese market is crucial for the Australian wine industry in the context of French and Australian producers pulling out vines and switching to other industries. This is based on mutual trust between China and Australia, and is the result of China and Australia moving in the same direction since the Australian Labor Party government came to power.
China is sincere in communication and consultation for mutual benefit and win-win results, and it is clear that China has no shortage of trade tools to punish Australia, the United States and other parties for their destructive behavior. As a resource-based country, Australia lacks the bargaining chips to engage in a trade war with China. There is extensive room for cooperation between the two countries in the trade of iron ore and wheat, and they can also achieve more mutually beneficial results based on each other's economic endowments.