SYDNEY — Australian exporters face a difficult hunt for new markets as tensions with China reach a precipitous point, hurting businesses on both sides.
China has either slowed or stopped imports of Australian cotton and coal in recent weeks. That is on top of hefty tariffs imposed on Australian barley and a ban on beef from five major Australian producers. The Asian giant is also looking into putting levies on Australian wines.
While Australia’s relationship with its No.1 trading partner has been on thin ice since 2017, tensions escalated rapidly earlier this year after Prime Minister Scott Morrison called for an international inquiry into the origins of COVID-19. Agricultural commodities — worth an annual 13 billion Australian dollars ($9.25 billion) — have suffered the biggest collateral damage as a result.
“What China is doing is firing off different shots and trying to see how much punishment Australia is willing to take,” said Naoise McDonagh from the University of Adelaide’s Institute of International Trade. “It’s ‘feeling the stones’ as the expression goes, to suss out how much leverage it can generate.”
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