China has imposed an extraordinary tariff on barley exports from Australia apparently to punish the country Down Under for Australian Prime Minister Scott Morrison’s push for a coronavirus inquiry. Morrison had demanded in April an independent probe into the genesis of the virus — that may cause a fatal respiratory disease — and the World Health Organisation’s handling of the crisis.
In response, the state media of China and the political heads in Beijing warned of trade retribution that could wipe $ 135 billion from the Australian economy. China on Monday announced an 80.5% levy on barley exports starting on Tuesday. This follows China threatening Australia for weeks to boycott the meat and barley industries and restrict travel and foreign education opportunities.
However, Australia’s Minister for Trade Simon Birmingham on Monday night denied Australia had subsidised or dumped barley in China. ‘Australia is deeply disappointed with China’s decision to impose duties on Australian barley,’ Birmingham said in a statement.
The communist state claims Australia subsidised its farmers and dumped barley in China. The punitive Chinese tax will remain in place for five years, China’s Ministry of Commerce said.
The WHO, meanwhile, has yielded before international pressure. On Monday it agreed to launch an independent probe into how it managed the international response to the coronavirus.
After a coalition of African, European and other countries including Australia demanded the probe, the WHO said it had begun a ‘comprehensive’ evaluation which is intended to review lessons learned from the UN agency’s coordination of the global response to COVID-19. However, the inquiry will stop short of looking into contentious issues such as the origins of the respiratory virus.
Australian Foreign Minister Marise Payne had earlier welcomed the apparent majority support for the motion. She said her government wanted the inquiry to be impartial, independent and comprehensive.
Australia is seen as a leader in rallying global support for an inquiry, which the WHO move may not measure up to. Beijing says Australia is ‘parroting’ the United States and inviting a Chinese boycott of exports and services.
‘Should have taken allies into confidence before antagonising China’
The opposition in Australia argues that Prime Minister Morrison’s conservative administration should have gathered allies before antagonising the country’s largest trading partner.
China’s Ministry of Commerce released a statement, saying, “There was a subsidy for imported barley originating in Australia, the domestic barley industry was substantially damaged, and there was a causal relationship between the subsidy and the actual damage.”
Birmingham confirmed Australia had expanded a trade agreement with Indonesia recently and had other potential buyers for the produce.
In contrast, China — the world’s top barley importer — will simply switch to purchasing from other key producers like France, Canada, Argentina and some smaller European exporters. “It’s very replaceable,” said Andries De Groen, managing director at the Germany-headquartered barley trader Evergrain.
Nadir of China-Australia relations
China has announced the punitive tariffs amid deteriorating relations between Canberra and Beijing, which have been exacerbated by the push for an investigation into the origins of COVID-19.
But the Chinese foreign ministry insists the new policies are not related to the inquiry and are instead a reflection of an 18-month anti-dumping investigation.
Chinese President Xi Jinping agreed to the coronavirus probe on Monday night, hours before the tariffs were imposed. He said he would only support the inquiry after the pandemic has been brought under control globally. “This work needs a scientific and professional attitude and needs to be led by the WHO, and the principles of objectivity and fairness need to be upheld,” he said.
Xi reiterated Beijing’s defence of its actions when the COVID-19 outbreak emerged in the country.
It is widely accepted that the virus first spread from a wet food market in Wuhan. However, intelligence agencies have proof China deliberately introduced the virus to the market.
Xi pleads innocence
Calling the pandemic “the most serious global public health emergency since the end of World War Two”, Xi said, “All along, we have acted with openness and transparency and responsibility.”
Xi said China would stump up $ 2 billion (3.1 billion in Australian dollars) over the next two years to help deal with COVID-19, especially to help developing countries.