As sales tumble, Australia takes its wine dispute with China to the WTO

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July 1st, 2021 By: Norvisi Mawunyegah

The Australian government said on Saturday that it has filed a formal protest with the World Trade Organization over China’s application of anti-dumping tariffs on Australian wine exports, intensifying the trade spat with Beijing even further.

“The government will continue to vigorously defend the interests of Australian wine makers using the established system in the WTO to resolve our differences,” Dan Tehan, minister for trade, tourism and investment, said in a joint news release with the Agriculture Minister David Littleproud.

Relations with China have deteriorated since Canberra called for an international investigation into the origins of the coronavirus, which was first reported in central China last year. Relations with China were already strained after Australia banned Huawei from its nascent 5G broadband network in 2018.China, Australia’s largest trade partner, retaliated by putting duties on Australian goods such as wine and barley, as well as restricting imports of Australian cattle, coal, and grapes, which the US characterized as “economic coercion.”

Last year, Australia filed a formal request with the World Trade Organization (WTO) for a review of China’s decision to impose high duties on Australian barley imports. According to the Australian government, the wine taxes doubled or tripled its price, making the Chinese market unviable for exporters.

According to industry figures, Australian winemakers shipped only 12 million Australian dollars (US$9 million) of wines to China in the four months from December to March, down from 325 million Australian dollars (US$243 million) a year earlier, confirming that hefty new tariffs have effectively eliminated their largest export market.