Australian Exporters Are Reigniting Their Relationships With China as Diplomatic Tensions Ease

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As the diplomatic relationship between Beijing and Canberra warms up, two-and-a-half years after Chinese trade restrictions hit Australian exports such as coal to wine, businesses are taking bold measures in anticipation of a revival in their sales. 

In 2020, tension was established due to the Huawei espionage issue and the on-set of COVID-19. For these reasons, China imposed a series of extensive “trade blockages” estimated at A$20 billion.

The collaborative diplomatic efforts from both countries, from their respective leaders down to trade ministers since November, slowly tore down the great wall that separates both parties.

Responding to the political signals, business owners in Australia have made plans to visit China in March, such as Fortescue Metals founder Andrew Forrest and BHP head Mike Henry. Tim Ford, an executive at Treasury Wine Estate affected by tariffs, will also make a trip.

The president of the Australian Forest Products Association reported that conversations with Chinese customs about log imports have been “encouraged” by agricultural authorities in Australia. It was formerly a multi-million dollar industry worth A$600 million annually.

“We’re optimistic that shortly – could be three months, could be six months – we might see a resumption in trade,” Victor Violante, the esteemed CEO of the renowned organisation, said. 

By ending its current trade restrictions, Australia can revive its ties with China even as it further strengthens security partnerships with the United States and the UK through the AUKUS nuclear submarine alliance.

Due to disagreements over national security and human rights, the quest to revitalise trade relations between Australia and China could be challenging. In March, Australia is anticipated to reveal more details concerning its plan to acquire nuclear submarines – which Beijing is firmly against.

Premier Mark McGowan of Western Australia, a major exporter of grains, iron ore, and natural gas, recently talked with Long Dingbin – China’s top diplomat. The Chinese consulate in Perth has disclosed that Mr. McGowan is eager to travel to China soon for his fifth visit since taking office.

People are starting to get on the front foot. Trade is ultimately about relationship, and people are getting those relationships in place.” Grain Trade Australia Chief Executive Pat O’Shannassy said. 

Prime Minister Anthony Albanese stated that Australia would examine the value of any agreement, yet he is also vigilant about Australia’s autonomy.

Even if trade resumes, many producers are determined to be independent of China again.

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