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Beijing could soon end punitive tariffs on Australian wine after tensions ease

Chinese President Xi Jinping is poised to end punitive tariffs on Australian wine after holding ‘very positive’ talks with Prime Minister Anthony Albanese in Beijing.

Last month, Beijing agreed to review the tariffs of up to 218% imposed on Australian wine.

Wine exporters hoping for a positive outcome were given a major boost this week after the countries’ leaders agreed to stabilise relations.

After the meeting, Albanese told reporters: ‘I noted very much unimpeded trade was in the interest of both countries, was good for Chinese consumers as well as Australian exporters. He certainly agreed that Australian wine is good.’

Albanese said they had ‘a bit of a debate about wine’ during his meeting with Xi. The Chinese leader said he had discovered the quality of the wine in New Zealand during a recent visit, but Albanese ‘asserted Australia’s pre-eminence when it comes to quality red wine’.

They also discussed the relative cuteness of Tasmanian devils and pandas. ‘That shows really just how warm the exchange was,’ said Albanese, describing the talks as ‘very positive’.

It is a far cry from 2020, when Canberra called for an international inquiry into the origins of the Covid-19 pandemic in Wuhan.

Beijing was already upset by the decision to exclude Chinese firm Huawei from taking part in the rollout of next-gen phone networks in Australia, and that proved to be the final straw.

The Chinese government responded by imposing an up to 218% tariff on wine imported from Australia, which caused sales to plummet.

At the time, China was the largest market for Australian wine, as exports had increased by 4% to $1.2 billion in the year to September 30, 2020.

By the end of 2021, sales in Mainland China had fallen by 97%, and Wine Australia closed its Shanghai office.

The industry is now facing an oversupply crisis, with enough wine in storage to fill 859 Olympic swimming pools, after total exports decreased by 33% over the past two years.

However, there is now light at the end of the tunnel for Australian producers, who expect the tariffs to be scrapped soon.

‘The China-Australia relationship has embarked on the right path of improvement and development,’ Xi said after his meeting with Albanese. ‘I’m heartened to see that.’

He added that Albanese’s visit was ‘highly significant, as it builds on the past and ushers in the future’.

Layla Wang, co-owner of Trio Wine Bar in Beijing, told Reuters that Chinese consumers would welcome the return of Australian wine.

‘We all think it’s a very good quality wine,’ she said. ‘For us, we’re definitely delighted as it signifies offering more choices to our customers. For consumers who haven’t had Australian wines for years, many will be eager to try them again.’

Campbell Thompson, CEO of Beijing-based wine importer and distributor The Wine Republic, added: ‘We are looking forward to the tariffs being removed. I think for Australia there is definitely an opportunity.’


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