Positive Signs of Normalization: Chinese Government Eases Tariffs on Australian Wine Imports, but Businesses Caution Against High Expectations

China Nearing Completion of Australia Wine Tariff Removal, Says Business Leader

Recently, the China government has shown signs of lifting heavy tariffs on Australian wine imports. The Australia China Business Council hosted a meeting with Chinese Foreign Minister Wang Yi, where it was emphasized that China is “opening up” to foreign investment. While this development is positive news, the National President of the business lobby group, David Olsson, has cautioned against high expectations for all producers returning to the market once the sanctions are lifted.

Speaking to Bloomberg during the Boao Forum in China, Olsson highlighted concerns from Australian businesses about the importance of predictability and certainty, especially for longer-term investments in the Chinese market. He acknowledged that while Australian business leaders understood the significance of the China market, they were not expecting a return to the pre-tariff era due to ongoing geopolitical tensions.

Trade relations between Australia and China have shown improvement since the election of the center-left Labor government in May 2022. Beijing has gradually lifted trade sanctions imposed on Australian exports during tensions, including restrictions on barley, timber, and coal. However, the most significant remaining sanctions are on Australian wine, with tariffs as high as 218%.

The Australian government is optimistic that wine tariffs will be removed by the end of March. However, Olsson noted that not all of it is expected to return to the Chinese market. Some producers are already exploring alternative markets. Despite this positive development in trade relations between Australia and China, businesses need predictability and certainty before making long-term investments in their respective markets.

Sophia Reynolds

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