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Australia pushes for normalized trade relations with China and demands the removal of trade barriers.

As diplomatic tensions between Australia and China reached their peak in 2020 and 2021, Beijing imposed import tariffs on a range of Australian exports, including wine, red meat, lobsters, and timber. Although some restrictions have been lifted recently, Australia is steadfast in its stance that normalized trade ties with China should only be pursued once all remaining trade curbs are completely eliminated.

Australia’s Assistant Minister for Trade, Tim Ayres, reiterated this position in an interview with CNBC’s Martin Soong during the B20 summit in New Delhi. Ayres expressed that while the removal of tariffs on Australian barley imports was a positive step, true normalization and stabilization of trade between the two nations can only occur when all trade barriers are dismantled.

The tensions between the two countries prompted China to impose various trade restrictions, causing disruptions in the Australian export market. These restrictions were aimed at goods such as wine, red meat, lobsters, and timber, undermining the smooth flow of trade between the two nations. In particular, the tariffs on Australian wine imports, introduced in March 2021, have been a source of contention.

Australia’s trade minister, Don Ferrell, echoed Ayres’ sentiments earlier this month after Beijing lifted tariffs on Australian barley imports. Ferrell emphasized that a comprehensive return to normal trade relations with China necessitates the removal of all remaining trade impediments. While China has taken steps to address some of these issues, the lingering restrictions continue to hinder the full resumption of trade activities.

In an effort to resolve the trade disputes, Australia temporarily suspended its World Trade Organization (WTO) complaint against China. The complaint was initially filed in response to China’s decision to impose significant duties on Australian barley, amounting to 80.5% of its value. This trade dispute significantly impacted the bilateral trade relationship, with the barley trade alone being valued at around 1.5 billion Australian dollars ($988.1 million).

By temporarily suspending the WTO complaint, Australia aimed to expedite China’s review of the tariff decision, hoping to restore smoother trade relations. The move signaled Australia’s willingness to engage in dialogue and find common ground to mitigate the impacts of trade barriers on both nations’ economies. Ayres emphasized that the obstacles to trade, while affecting Australia, are also not in the best interest of Chinese businesses, underscoring the importance of a rules-based approach to international trade.

The desire for normalized trade relations reflects Australia’s commitment to fostering a stable and productive economic partnership with China. The country acknowledges the significance of trade ties with its largest trading partner, which have been crucial for its economic growth and development. The removal of trade barriers, including tariffs and restrictions, would not only benefit both nations’ economies but also reinforce confidence in the rules governing international trade.

In conclusion, Australia’s push for normalized trade relations with China is underscored by its insistence on the complete removal of all remaining trade barriers. While some positive steps have been taken, such as the lifting of tariffs on barley imports, Australia maintains that true normalization and stability in trade ties can only be achieved through the comprehensive removal of all trade curbs. This approach aligns with Australia’s commitment to a rules-based international trade system and its desire to establish a strong and mutually beneficial economic relationship with China.

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