Beijing’s curbs on coal imports trigger trade tensions between Australia and China

Australian government has been trying to prod Chinese authorities to gain confirmation regarding Beijing’s recent restrictions on coal imports. The move, which so far has been reported by Chinese state-owned steel makers and power plants including S&P Global Platts and Argus Media, but still lacks official statement authenticating the same. Australia’s trade minister, Simon Birmingham, said the authorities were trying to reach China “through diplomatic channels overnight” to gain clarity over the matter.

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Birmingham also added that the Australian government had put across its desire to resume the ministerial-level talks with the Chinese government, which had been stalled. He said, “our door remains wide open to do that”.

To put to rest the speculations around rising trade tensions between the two nations, on Tuesday, Australian Prime Minister, Scott Morrison said the government was looking into the reports, and added that it was “important not to get ahead of ourselves here” because it was “not uncommon” for China to impose such restrictions as it does so to protect domestic quotas, and guard its local coal production and jobs.

Morrison said, “That is not uncommon to see that and I can only assume, based on our relationship and based on the discussions we have with the Chinese government, that that is just part of their normal process.”

On the other hand, Australian the Labor leader, Anthony Albanese doesn’t want the issue to be taken lightly as China has been one of the largest trading partner of Australian and the decision would hit Australian economy. Albanese said that reports regarding recent curbs was “a huge concern” and even accused the Morrison government of failing to making adequate efforts “to have a positive, constructive relationship” with China.

He also suggested that Australia should pursue trade diversification, to reduce its economic dependence on both coal, exporting more greener solutions in terms of export market. He said, “We are a democracy, they’re not, but that doesn’t mean that you can’t have an economic relationship with China. It’s too important for us to ignore that.”

Ties between Australia and China can easily be termed as at their lowest in decades. Many observers believed that the withering of their relationship started in 2018 when Australia decided to ban the Chinese tech giant Huawei from delivering its 5G network, citing national security as reasons. It was followed by Australia’s global call for independent investigation into the origin of the coronavirus and its early handling by Beijing. The condition worsened with recent detention of Cheng Lei, an Australian citizen and high-profile host for China’s English media broadcaster CGTN, by Chinese authorities on account of endangering national security. Besides, two other journalists, working for Australian media in China, were also rushed back to Australia around the same time on diplomatic advice.

China retaliated through a range of actions by directly targeting Australian exporters this year, including imposing tariffs on barley imports, suspending imports from five red meat processing plants and launching two trade investigations into Australian wine.

Many believed that Australian government got its guard up since 2017 when the Australian Security Intelligence Organisation (Asio) warned it of increasing Chinese influence in its political decision-making through donations from Chinese businessmen to local politicians.

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