China reviews tariff on Australia barley

Australia has opted to suspend its case at the World Trade Organization (WTO) that pertains to China's imposition of duties on barley.

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China has announced its decision to remove tariffs on imports of Australian barley, a move that brings an end to a three-year period of trade restrictions impacting significant trade volumes. Prime Minister Anthony Albanese of Australia has welcomed this development, marking a positive step in their bilateral relations. Additionally, Australia has opted to suspend its case at the World Trade Organization (WTO) that pertains to China’s imposition of duties on barley.

This gesture signifies a warming trend in the relationship between the two nations. Notably, Australia extended an invitation to China’s new foreign minister to visit the country, emphasizing their willingness to engage in diplomatic dialogue.

China’s Ministry of Commerce has confirmed that the tariffs on Australian barley will be lifted commencing this Saturday. The decision comes in light of shifts within China’s barley market dynamics, rendering the imposition of anti-dumping duties and countervailing duties on Australian barley imports no longer necessary.

Prior to the implementation of these tariffs, Australia’s government had estimated that annual barley exports to China averaged around A$1.2 billion ($790 million; £620 million). In 2020, China introduced tariffs on various key Australian exports, including barley, beef, and wine, alongside unofficial restrictions affecting lobster and meat exports from specific abattoirs.

The Australian government is now urging China to reconsider its tariffs on Australian wine, a matter that has prompted a separate complaint to the WTO. The Australian wine industry was significantly impacted by China’s imposition of substantial tariffs in 2020, leading to a significant reduction in access to its once thriving market.

The relationship between Australia and China had considerably deteriorated in 2020 when then-Prime Minister Scott Morrison called for an international inquiry into the origins of the Covid-19 pandemic. Following the election of Australia’s center-left Labor government in May 2022, communication channels between the two countries were reopened, resulting in an overall improvement in their diplomatic ties.