Australia seeks separate dialogue with China over wine dispute, rejects linkage with other trade issues

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24th September 2023 – (Sydney) Australia’s Agriculture Minister announced on Sunday (24th September) that the country desires a separate dialogue with China to address their ongoing dispute over wine. This comes as Australia rejects Beijing’s proposal to link the wine issue with other trade matters, as the two nations cautiously work towards improving their strained relations.

Australia’s hopes for an easing of wine tariffs were boosted last month when China removed tariffs on Australian barley. The wine tariffs, which have been in place since 2021, have severely impacted Australia’s wine exports.

The bilateral relationship between Australia and China deteriorated in 2020 when Australia called for an inquiry into the origins of COVID-19. This move triggered retaliatory measures from Beijing, including a series of trade restrictions that have negatively affected Australia’s export-dependent economy.

On Thursday, China proposed a “packaged solution” that would connect the wine dispute with issues surrounding duties on Australian imports of Chinese railway wheels, wind towers, and stainless steel sinks, according to state news agency Xinhua.

However, Agriculture Minister Murray Watt emphasized on Sunday that Australia views these matters as completely separate. The Australian government seeks to resolve the wine dispute through dialogue, similar to how the barley dispute was resolved.

Watt stated in an interview with the Australian Broadcasting Corp, “We will continue our WTO (World Trade Organization) case when it comes to wine, and we will continue to defend the case when it comes to steel,” referring to the ongoing disputes at the global trade body.

China was Australia’s largest export market for wine before the impact of COVID-19, with exports peaking at A$1.2 billion (US$770 million) in the 12 months leading up to January 2020. However, due to the ongoing dispute, wine exports to China have plummeted to just A$8.1 million in the year up to June.