Threatening WTO action won’t get Australia out of its dilemma
Published: Jun 03, 2021 09:38 PM
Illustration: Xia Qing/GT

Illustration: Xia Qing/GT

As an increasing number of winemakers and grape growers in Australia urge the Morrison government to properly solve the anti-dumping tariff issue with China, Australia Trade Minister Dan Tehan told CNBC on Wednesday that Australia is considering whether it should get the World Trade Organization involved in.

Sure, it is one country's right to call in the WTO when it is involved in a trade dispute. But in this case, it is apparently not the right solution. China's anti-dumping tariff decision was after thorough investigation and deliberation. The legitimate tariffs are necessity in place with the purpose of ensuring fair business competition.

Canberra knows very well that the Chinese market could be salvaged only when policy solutions are offered to put an end to the current dumping and subsidy practices in Australia, but instead Tehan once again chose to pull another publicity stunt. Playing a victim narrative as he did repeatedly, Tehan told CNBC that he had written to China, but has yet to receive a response.

Tehan said Australia will decide whether it will go to the WTO with regards to wine in the coming weeks. If Australia initiates WTO dispute complaint against China again like it did against Chinese barley duties in last December, aside from the time consuming procedures, the odds are very much not in Australia's favor. It will be difficult for Australia to overturn China's anti-dumping tariff decision which was verified through rigorous investigations and hearings.

China, on the other hand, has taken a consistent and balanced attitude toward the Australian government's repeated publicity stunts. As for Australia's potential wine appeal against China, China is expected to deal with the matter according to the WTO dispute settlement mechanism again.

Australia's attempt to lodge complaints to the WTO is no more than a sign of perfunctory treatment towards struggling Australian businesses. 

After provocations against China, some politicians in Canberra have put themselves at an awkward and passive position. Yet they seem have decided to double down on hysteria. While pulling more publicity stunts that completely not helpful in easing trade tensions with China, Canberra is attempting to coerce other countries to confront China on baseless accusations.

Looking at the root of the affliction of the pain being felt by Australian companies, some believe that it was the Morrison government's radical approach in dealing China relationships that had put these businesses at stake. It must be pointed out that Australian businesses' situation has become much more vulnerable amid the impact of COVID-19. At the end of the day, if Australian businesses are near breaking point, it will cost politicians more than bad newspaper headlines.

It is hoped that Australia can take genuine measures to rectify its trade problems by stopping dumping its wine and other products in the Chinese market. It should also reflect on its ill-advised behavior in the past and stop poisoning the economic ties with China that are supposed to benefit both countries.

The author is a vice chairman of the China Society for World Trade Organization Studies in Beijing.

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