By Elishya Perera
SYDNEY, Australia (CWBN)_ Australia should punish China for trade actions against exports from Canberra, by imposing tariffs on iron ore exports to Beijing, former minister for resources says.
In the recent months the communist superpower imposed large tariffs on Australian wine and barley, while other exports including wood, coal, beef and seafood were also blocked. However, Beijing has been unable to expand these embargoes on iron ore, owing to China’s dependence on construction and heavy manufacturing industries.
Following the Brumadinho Dam disaster in January last year, which diminished Brazil’s iron ore exporting capacity, Australia has become one of the world’s few iron ore exporters, which has put Canberra in advantage amidst the growing dispute between China and Australia.
Therefore, Nationals Senator Matt Canavan, who held the resources portfolio from October 2017 until February this year, said the government should therefore impose retaliatory tariffs on iron ore exported to China, and distribute the proceeds to producers affected by Beijing’s duties.
The Senator wrote in The Australian that making the Chinese Communist Party “pay a price” is the only way to stop further trade restrictions.
He claimed that a mere one per cent levy would raise more than $800 million, and therefore, insisted that Canberra should signal that the levy would increase if the communist regime takes further action against Australian exporters. “We could signal that the levy would be removed if China ended its unjustified trade restrictions,” he added.
However, this would be breach of the free trade agreement between the trade partners which was signed in 2015, and it would also risk worsening of relations with Beijing and may harm the iron ore industry and the economy.
Current minister of resources and also a member of the National Party, Keith Pitt, said the government would not consider such a measure. “Backbenchers are entitled to their views, we work under the rules-based trading system, and Australia will meet its commitments,” he said.
Three weeks ago, the Australian Bureau of Statistics revealed that iron ore exports hit a record high of $10.9 billion in October this year, and it was reported that China was the largest importer of the commodity used to make steal, purchasing 80 percent of the export.
However, tensions between the two trade partners escalated in the recent months, after Prime Minister Scott Morrison called for an investigation into the origin of the COVID-19 pandemic, which emerged from Wuhan, China. His comments provoked Beijing, and China slapped Canberra with economic sanctions in retaliation.
Relations with the communist regime hit a new low last month after a senior government official in Beijing shared a highly distressing fabricated image of an Australian soldier slitting a child’s throat, after a report alleged war crimes committed by Australian Special Forces in Afghanistan.
Morrison demanded an apology from the Chinese government for sharing the “deplorable” and “terribly offensive” fake photo on social media. Nevertheless, China has not backed down from the tweet and said there will be no apology.
Meanwhile, the Australian government is appealing to the World Trade Organisation on China’s tariffs on barley and wine, claiming Beijing has broken the agreement. Therefore, imposing duties on iron ore exports to China would leave Canberra open to accusations of hypocrisy.
