China’s Ministry of Commerce issued Notice Nos. 6 and 7 of 2021 on March 26, announcing the final ruling of the anti-dumping and countervailing investigations on the relevant wines originating from Australia, ruling that the relevant wines imported from Australia are dumped and subsidized, and that the relevant domestic wine industry in China has been materially damaged, and that there is a causal relationship between dumping and subsidies and material damage, with the final ruling finding The dumping margin is 116.2%-218.4% and the subsidy margin is 6.3%-6.4%. This means that China will uphold its November 2020 decision to charge Australian wine, and officially charge up to 218.4% on wine originating in Australia (size 2 liters and below) for five years from March 28.
Australian Trade Minister Dan Tehan responded on 27 March that this meant it was “basically impossible” for Australian wine to be competitive in the Chinese market. He said, “We will be looking at the next steps, including looking at taking the matter to the World Trade Organization (WTO).”
Tehan said such a decision “makes it difficult for us to continue to work with the Chinese government to develop economic relations between the two countries. Tehan said he had spoken to the Australian wine industry and was considering taking the issue to the WTO, noting that the Australian wine industry and government would work closely together to develop other markets. Tehan said, “Chinese consumers have very clearly shown their love for Australian wine and we are very confident that consumers around the world will also want to appreciate the excellent products produced by Australian winemakers and Australian grape growers.”
Tehan spoke of the Chinese announcement that the tariffs to be implemented meant it was “basically impossible” for Australian wine to be competitive in the Chinese market. “This decision by the Chinese government is very disappointing and totally unjustified,” he told reporters in Melbourne that day. He added, “We will look at the next steps and the next steps will include looking at taking this matter to the WTO,” according to Australian government data, which shows that Australia’s wine exports to China hit a record A$1.3 billion in 2019, making China the largest market for Australian wine by value. Late last year, Australia also called on the WTO to investigate tariffs imposed by China on barley imports.
In a speech in Sydney on Saturday, Australian Prime Minister Scott Morrison accused Beijing of using the tariffs as “retaliation”. He said Australia “totally rejects non-tariff restrictions. “By their own public admission, (this is) some form of retaliation for Australians standing up for our values,” Morrison said, telling reporters. “This is not acceptable.”
Morrison added that Australia joined Britain in condemning what happened to the Uighurs in Xinjiang, and that Australia’s allies have been sanctioned for their stance. Morrison said Australia stood with British Prime Minister Boris Johnson after China imposed sanctions on people associated with the U.K. and the European Union for their solidarity with the Uighur Muslim minority in Xinjiang. He said, “So Boris – well done, mate – we stand with you and thank you for standing with Australia.”
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