Tuesday, October 3, 2023

China chats pay off

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Kristin Murdock, Naracoorte Community News

The Australian Government has reached an agreement with China that creates a pathway towards resolving the dispute over Australian barley exports, which, since 2020 have been subject to an 80.5 per cent duty. This effectively blocked exports to that market, worth about $916 million in 2018-19.

National Farmer’s Federation Chief Executive, Tony Mahar, welcomed the news.

“We welcome the announcement from Ministers Penny Wong and Don Farrell on the expedited review of duties on Australian barley,” he said. “China is an important market for Australian farmers, taking about 60-70 per cent of our barley exports.”

In return for Beijing’s cooperation, Senator Penny Wong said Canberra will temporarily suspend its appeal to the World Trade Organisation (WTO) over the trade restrictions.

The agreement between the two countries will involve undertaking an expedited review of the duties over a three-month period, which may extend to a fourth if required. It is hoped the constructive approach the countries have taken to progress this issue is in the longer-term interests of all parties and Australian farmers.

If the duties are not lifted at the end of the review period, Australia will resume the dispute in the WTO. The WTO trade disputes system encourages bilateral resolution where possible.

In a media release, Senator Wong said the Government remains confident in the outcome for Australian wine at the WTO and if the agreement is successful in providing a pathway for lifting duties on barley, the government expects a similar process to be followed to remove trade barriers for Australian wine.

Tony Mahar recognises the positives behind the agreement.

“The constructive approach the countries have taken to progress this issue is in the longer-term interests of all parties and Australian farmers,” Mr Mahar said.

“This agreement highlights the value of the WTO process to encourage mechanisms for bilateral dispute resolution. We anticipate this will mean Australian farmers will have access to the Chinese market sooner. We also hope this development is another step forward in recalibrating our relationship with China and will mean progress will also advance on removing trade barriers for rock lobster and wine.”

Lee McLean, Chief Executive at Australian Grape and Wine, is also cautiously optimistic this could pave the way for winemakers.

“At its peak, the China market was valued at about $1.2 billion,” said Mr McLean. “Last year, we exported about $12 billion worth of wine to China, about a 99 per cent reduction in our total exports.

“That has major flow-on effects across the industry… to put it in context, our next two largest export markets at that time were the US and the UK, and they both sat at just under $500 million each,” he said.

Senator Penny Wong said when speaking to Sky News that wine is on the agenda.

“We are seeking to have a pathway to clear that impediment (of barley taxes), and if that works, we will work to apply that to other Australian products,” said Wong. “Probably the next one I’d want to look at is wine.”

Naracoorte Community News 10 May 2023

This article appeared in the Naracoorte Community News.


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