Australia likely to go to the WTO if China extends wine tariffs

Following the introduction in China of temporary tariffs on Australian wine imports last year, the Australian wine industry is now expecting an imminent announcement of both an increase and expansion of the tariffs.  

Already valued at a whopping 200%, Australian winemakers are predicting that the tariffs will be increased to 220% for the next 5 years.

Whilst the increase will have little impact on trade volume (the $1 billion Chinese export market has already all but evaporated!), the extension to 5 years will give Australia ground to refer the dispute to the World Trade Organisation (WTO).

Australia is likely to bring the case to the WTO that their winemakers are being unfairly targeted, and that China is engaging in anti-competitive and protectionist behaviour.

Every story has two sides though… China imposed the tariffs in the first place after a wide-scale investigation into Australian dumping into the Chinese wine market. The result being that Chinese winemakers were being significantly harmed by the dumping of Australian wine. This came shortly after China had already put an 80.5% tariff on all Australian barley imports.  

Once it goes to the WTO, it will be up to them to settle the dispute and attempt to help Australia and China rebuild their trading relationship so that both can benefit from the advantages which free trade can bring.