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 Something good at last. Resilience against Beijing’s bullies!

08.04.21.  This article suggests that Australia has not suffered under the Chinese trade tariff attacks as much as first thought. It also suggests that our exporters got off their for many years complacent bums and found new markets—something they should have been doing to avoid what China was always going to do. The old proverb stands firm—”don’t put all your eggs in one basket!” Sadly, the wine industry does not share the joy.
Australian exporters are defying Chinese trade bans, limiting the damage of Beijing’s punitive ­economic campaign by finding new markets for ­almost all affected products. Economic analysis reveals that although $20bn a year has been slashed from Australian exports to China, the nation’s barley, coal, copper, cotton, sugar and timber producers have either partially or completely offset this by diverting shipments to new buyers in other countries.

Source: Ben Packham and Rosie Lewis, News Corp

Sanctions fail: exporters defy Chinese trade bans

Lowy Institute chief economist Roland Rajah said only the ­nation’s wine traders had struggled to make up for the loss of their premium Chinese market.
Mr Rajah said that, with the exception of wine, the net loss to Australian exporters as a result of the bans — imposed over ­Australia’s call for an inquiry to the origins of COVID-19 — amounted to less than $1bn. But when all of Australia’s exports were taken into account, soaring iron ore ­prices had “completely swamped” the effect of the Chinese trade bans.
Chinese ambassador Cheng Jingye defended the trade bans on Wednesday and blamed Australia for “the difficulty we now have in the bilateral relationship”.
The Chinese embassy set out Beijing’s grievances with Australia late last year in a list that included the Morrison government’s call for a COVID-19 inquiry, the ban on Huawei participating in the 5G network and its foreign interference laws.
Trade Minister Dan Tehan ­unveiled a new strategy on Wednesday to help “Team Australia win in Asia’’, saying the Indo-­Pacific presented a much more complex strategic environment than in past decades.
Mr Tehan said it would take a collective effort by government and the private sector to ensure Australia could capitalise on ­opportunities in the region in the next five to 10 years.
The Asia Society and Business Council of Australia’s Asia ­taskforce also recommended ­exports should make up 35 per cent of GDP by 2030, up from 29 per cent today.
It also warned that navigating the China relationship would ­require “strategic patience, avoiding over-reaction and emotion, maintaining long-established personal networks, and continuing to be prepared to co-operate on ­issues that benefit both countries”.
The council said diversification should not exclude China but be in addition to pursing the Chinese market. It identified Indonesia and Japan as countries Australian businesses could target for export opportunities in healthcare and financial services. South Korea and Vietnam also presented significant opportunities”, as industry sought to diversify beyond China.
Mr Tehan, whose Chinese counterpart, Wang Wentao, still refuses to speak to him, called on Australia’s business community to “step up to the plate” and engage with China where the government was unable to.
“We can’t sit on our hands and just sort of think ‘oh well that’s not very good’,” Mr Tehan told business leaders in Canberra.
“What we need to do is we have to find other ways to keep ­engaging and to keep sending that message that we do want a good relationship, we want a friendly relationship with China.”
In his report to be published by the Lowy Interpreter on Thursday, Mr Rajah said the impact of the Chinese sanctions had been “quite limited”.
“Exports to China have ­predictably collapsed in the areas hit by sanctions, but most of this lost trade seems to have found other markets,” Mr Rajah said.
While ships carrying Australian coal had been unable to ­unload their cargo in China, ­causing a $6bn slump in the trade, Australian exports of the commodity were already down by about $7.5bn a year lower before the ban was imposed.
Mr Rajah said that, by January 2021, Australian coal exports to the rest of the world were running $9.5bn higher in annualised terms than before the ban.
“Whatever impact China’s ban on Australian coal might be having, it doesn’t seem to be enough to shift the overall picture a great deal once trade diversion is taken into account,” he said.
Mr Rajah found other Australian exports hit by the ban “show even clearer signs of substantial trade diversion”.
Sales of Australian barley, copper, seafood and timber to other markets rose sharply after the late-2020 trade sanctions. Australia’s wine exporters had “suffered terribly”, and beef ­exports were also down due largely to supply side issues, he said.
“On the other hand, a bumper barley crop has helped partially offset weakness in these other areas,” Mr Rajah said.
“Overall, Australia’s sanctioned exports to China other than coal held steady through most of 2020 at the equivalent of a little over $9bn a year, before falling to about half that level as sanctions escalated in late 2020.
“Meanwhile, exports in these same categories to the rest of the world rose by about $4.2bn in annualised terms — offsetting most of the loss.”
Mr Tehan said he had not received any response from Mr Wang, China’s Commerce Minister, after attempting to engage with him in January when he was handed the trade portfolio in a ministerial reshuffle.
“(But) we have previously had very good relations and there’s no reason why we can’t have them in the future,” he said.

Video source: Sky News

{ 9 comments… add one }
  • Graham+Richards 08/04/2021, 6:11 am

    All exporters must unite! When Beijing is short of commodities like barley or coal or wines on which they have increased tariffs make sure they go the back of the queue after being kept waiting for approval of their application for supply.
    Their trade agreements are now null & void. The same applies to the prices they paid. Prices will be those ruling at time of orders being accepted.
    There will certainly come a time when they urgently need us & we really don’t need them or the BS they spew!

    • Aktosplatz 08/04/2021, 7:34 am

      Couldn’t agree more, Graham. Let the CCP learn that economic sanctions are always a double edged sword, so if you give , you had better be able to take it.

      And, as I have said before, we should now put China at the back of the queue – permanently.

    • Penguinite 08/04/2021, 9:16 am

      I doubt the Chinese will ever be short of coal! Good quality coal maybe. It’s true they like our stuff because it burns cleaner and Australia is closer to the preferred usage point than their domestic supply. Wine too is unlikely to worry them. Chinese vintners have been scouring the worlds winemaking areas for years and have ‘copied the best and bought the rest’. Plus they already own large chunks of Australian winemaking. Similarly, Australian dairy products and production have been usurped!

  • Disgruntled 08/04/2021, 7:54 am

    We can do it; we really can; maybe a little pain but we will survive.

    We are starting to do it; Now the companies that like to suck up to and appease and prosper from China have to realise it!

  • Sir Peter 08/04/2021, 9:15 am

    “Peace in our time”. Has a familiar ring. Appease the little f%#kers and we will have war. As I said recently, the chicom flotilla in south ‘china’ sea is Sudetenland all over again. The combined navies of peace-loving nations must attack it, and when the PLA navy responds wipe them out. The sinofascists have to be confronted and stopped now, while they are weaker than us, or confronted later when they are stronger. That’s the choice we face.

    As a starter the Chinese must be expelled from Australia immediately.

    • Lorraine 08/04/2021, 9:52 am

      We have media telling us day in day out it is not the Chinese people , they are real and true Australians……Its just the Chinese Communist Party, this amuses me,,,,,who makes up the party , aliens is it,,,,,,,if not Chinese

    • DT 08/04/2021, 11:16 am

      Along with the Muslims meaning the many ethnic groups that worship Islam and speak different languages, the Germans, the Italians, the Japanese, and all other “enemies”.

      Maybe explain how Australian citizens could be deported?

      sarc

  • DT 08/04/2021, 11:06 am

    The International Monetary Fund (IMF) has upgraded Australia’s economic growth outlook in its latest World Economic Outlook. Amid continued “high uncertainty” globally, the IMF has confirmed our economy is recovering from the COVID-19 crisis faster and stronger than previously expected.

    Australia’s economy is forecast to grow by 4.5 per cent in 2021, one percentage point higher than the IMF’s interim outlook in January. The IMF then expects economic growth to reach 2.8 per cent in 2022, broadly consistent with its earlier projection.

    In upgrading its outlook, the IMF notes that the “Australian economy continues to show a strong recovery momentum” and that a “favourable labour market recovery continues to support a strong rebound in private consumption, added by wealth effects from rising house prices”.

    Australia’s GDP is “projected to reach the pre-COVID level by the March quarter 2021, limiting scarring effects of the pandemic” and compares favorably internationally with GDP remaining “significantly below pre-pandemic trends in most countries”.

    These forecasts follow the Morrison Government’s unprecedented response to the crisis, providing $251 billion in direct economic support that has helped to keep businesses in business and Australians in jobs.

    Australia also continues to compare remarkably well to other nations, with the IMF forecasting Japan’s economy to grow by 3.3 per cent, Germany by 3.6 per cent and Italy by 4.2 per cent.

    Encouragingly, global growth has also been revised up by 0.5 percentage points to 6.0 per cent in 2021 and by 0.2 percentage points to 4.4 per cent in 2022.

    The next stage of the Government’s Economic Recovery Plan will support private sector activity through a number of measures including tax cuts, unprecedented business investment incentives, record levels of investment in skills and training, infrastructure and targeted support for the aviation and tourism sectors.

    These household and business incentives will help to unlock the more than $240 billion of savings accumulated throughout the pandemic and sitting on private sector balance sheets.

    Having outperformed all major advanced economies on the economic front in the last 12 months, there is no other country you would rather be in than Australia.

    • DT 08/04/2021, 11:11 am

      It is often forgotten that the Hockey Abbott Government Budget for financial year 2014/15, called a budget repair, but criticised by Labor and others at the time, laid the foundations for recovery from Labor’s truly disastrous 2013/14 Budget with many items unfunded, no budget provision made to pay for them.

      And that by 2019/20 financial year there was a forecast budget in balance again, and then COVID-19 pandemic arrived in February 2020. However, without the budget repairs the borrowing to support employers and employees, and the strengthen the economy, would not have been possible, or far less flexibility available.

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