After three years of strained trade relations, China has announced the lifting of anti-dumping and anti-subsidy tariffs on Australian wine, effective from March 29, according to the Chinese commerce ministry. This decision marks a significant development in the ongoing trade saga between the two nations and brings relief to Australian wine producers.
The tariffs, initially imposed in March 2021 with rates reaching up to 218.4%, were part of a series of retaliatory measures against Australia following Canberra’s call for an investigation into the origins of COVID-19. However, with relations between the two countries showing signs of improvement since last year, China has been gradually easing trade barriers on Australian exports, including barley and coal, leading to expectations of the removal of punitive tariffs on wine.
The Chinese commerce ministry stated, “Given the situation in China’s wine market has changed, the anti-dumping and anti-subsidy tariff imposed on wine imported from Australia is no longer necessary.” This move comes as a relief to Australian wine producers, who had seen their exports to China plummet following the imposition of tariffs.
Previously, Australian wines enjoyed a tariff advantage over many other wine-producing nations in China due to a free trade agreement signed in 2015. However, the punitive tariffs imposed in 2021 drastically reduced Australian wine exports to China, with imports accounting for only 0.14% of Chinese wine imports in the first half of 2023 compared to 27.46% in 2020.
The Australian government welcomed the decision, emphasizing the critical importance of the move for the Australian wine industry. Campbell Thompson, CEO of wine importer and distributor The Wine Republic, expressed delight, stating, “We are delighted and we look forward to re-introducing some great wines to China very soon.”
Australian wine makers had been anticipating the removal of Chinese tariffs for months, with trade data showing a significant increase in wine exports to Hong Kong in December 2023. This development follows a period of trade tensions between China and Australia, which saw Canberra lodging complaints with the World Trade Organisation (WTO) over Beijing’s imposition of tariffs.
Under the joint efforts of both countries, China and Australia have reached a consensus on resolving disputes within the WTO framework, leading to the discontinuation of Australia’s legal proceedings at the WTO. Treasury Wine Estates (TWE.AX), Australia’s top publicly listed winemaker, expressed its readiness to expand sales and marketing efforts in China following the announcement.
Simon Woods, CEO of Australia’s Chamber of Commerce in Shanghai (AustCham Shanghai), hailed the decision as “fantastic news” and credited the hard work of both governments and businesses. The lifting of tariffs is expected to boost confidence within the Australia-China business community and provide relief to vine growers in Australia facing challenges of over-production amid declining global wine consumption.
