China’s beef imports from Australia grow rapidly, aided by preferential lower tariffs

By Wang Yi Source:Global Times Published: 2019/8/19 16:26:23

China has substantially increased beef imports from Australia in the first seven months of 2019, reaching the yearly imports quota under the free trade agreement between the two countries four months earlier than expected.

The bilateral free trade trade talks may be accelerated as China's domestic market continues to expand and the country is seeking more trade partners to oppose unilateralism and protectionism amid the trade war with the US, according to experts.

More imports from Australia are likely to enjoy a lower tariffs and a higher quota soon, experts said.

China's beef imports from Australia have topped 172,411 tons, exceeding the yearly quota on August 15 by 170,000 tons for 2019 under the agreement between the two countries, according to a note issued by the General Administration of Customs (GAC) on Monday.

Beef imports from Australia will be levied at the most-favored-nation tariff rate from August 17, said the note.

Although the beef exports from Australia exceeding the quota in 2019 will be levied at the most-favored-nation tariff rate, which is higher than the tariff rate under China and Australia's free trade agreement, the quota is expected to be lifted and the beef may enjoy a lower tariff in the future, Li Guoxiang, a research fellow at the Rural Development Institute of the Chinese Academy of Social Sciences, told the Global Times on Monday.

In 2018, the yearly quota was reached on December 27, generally in line with the original plan. Beef imports from Australia accounted for about 17 percent of China's total beef imports - 1.04 million tons that year.

China's beef consumption in this year was partly driven up by the breakout of African swine fever (ASF). Additionally, China's beef consumption continues to grow as domestic consumption upgrades, said Jiao Shanwei, a veteran analyst in the agricultural field.

The imports quota from Australia, which was set out to protect domestic producers, may be lifted as domestic demand grows faster than domestic production, Li said.

The bilateral free trade agreement between China and Australia took effect on December 20, 2015. Imports from Australia have been largely boosted by five rounds of tariff cuts thus far.

According to the tariff cuts model under the free trade agreement, China only has an imports limit quota on a handful of goods such as beef to protect domestic producers.

China and Australia have highly complementary trade structures. China has reiterated that it is willing to expand trade partnerships that respect free trade and multilateral trade rules, said Li.

The free trade talks between China and Australia are expected to accelerate, and more imports from Australia are likely to enjoy lower tariffs soon, Li added.


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