China lifts tariffs on Australian wine as bilateral ties recover

A staff member sniffs wine in a glass while a customer watches at Trio Wine Bar in Beijing, China Nov 1, 2023. REUTERS/Florence Lo/File photo

BEIJING — China will lift anti-dumping and anti-subsidy tariffs on Australian wine from March 29, the Chinese commerce ministry said on Thursday, ending three years of punitive levies and offering long-awaited relief to Australian wine producers.

The tariffs, of up to 218.4 percent, were first imposed in March 2021 for a period of five years along with a host of other trade barriers on Australian commodities when ties soured after Canberra called for a probe into the origins of COVID-19.

Ties have improved significantly since last year, leading China to steadily lifting trade hurdles on Australian goods, including barley and coal.

“Given the situation in China’s wine market has changed, the anti-dumping and anti-subsidy tariff imposed on wine imported from Australia is no longer necessary,” the commerce ministry said in a statement.

Previously, Australian wines imported into China were subject to zero tariffs after the signing of a free trade agreement in 2015, giving them a 14-percent tariff advantage over many other wine-producing nations.

READ: China to review anti-subsidy tariffs on Australia wine imports

“We welcome this outcome, which comes at a critical time for the Australian wine industry,” the Australian government said in a statement.

Australia to drop legal proceedings at WTO

“Since 2020, China’s duties on Australian wine effectively made it unviable for Australian producers to export bottled wine to that market. Australia’s wine exports to China were worth $1.1 billion in 2019.”

Beijing started imposing tariffs on Australian products in 2020, prompting Canberra to complain to the World Trade Organisation (WTO). When the tariffs on Australian wine were levied in 2021, Canberra urged the WTO to arbitrate in the dispute.

READ: China’s wine market ready to welcome return of Aussie wine as ties improve

Under the joint efforts of both sides, China and Australia reached a consensus on the proper settlement of disputes under the WTO framework, He Yadong, a spokesman at the Chinese commerce ministry, told reporters on Thursday.

The removal of the Chinese duties means Australia will discontinue its legal proceedings at the WTO, according to the Australian statement.

Australia’s top publicly listed winemaker, Treasury Wine Estates, said it welcomed the announcement and will start partnering with customers in China to expand sales and marketing, as well as brand management.