Chinese regulators announced on Friday that after finding preliminary evidence of dumping, they would start imposing heavy tariffs on Australian wines.
From Saturday, China will begin a temporary rescheduling of Australian wine imports from 107.1% to 212.1%, the Commerce Department said in a statement.
The move is another hurdle for Australian businesses as relations between Canberra and Beijing deteriorate.
China announced an anti-subsidy investigation in August following some Australian wine imports following a complaint from the Chinese Wine Association. Regulators then said they would investigate 40 allegations of unfair state aid in the Australian wine sector.
The Ministry of Commerce now claims to have confirmed cases of dumping, “causing material injury” to the Chinese wine industry in China.
The effects of the new measures could be devastating. China is by far the largest importer of Australian wine, says Wine Australia, a trade organization backed by the country’s government.
In the most recent fiscal year, which ended in September, China alone accounted for 39% of Australia’s total wine exports by value, the group said.
But Australia has annoyed China by calling for an investigation into the origins of the coronavirus epidemic. Later, Beijing targeted Canberra for trade, namely by suspending certain imports of beef and hitting heavy tariffs on barley.
In August, Australia virtually blocked the sale of a dairy business to a Chinese company when an official said the acquisition would be “against the national interest”. The deal, Lion Dairy, is now being sold to Australian company Bega Cheese as part of a deal worth $ 560 million ($ 413 million), the companies announced this week.
The latest news may come as a surprise to some, given that just last week Australia and China signed a major trade agreement called the Regional Comprehensive Economic Partnership (RCEP). Some say the agreement could help restore ties between the two countries.
China recently acknowledged the shabby relationship – but made it clear where it thought its finger should be shown. Last week, a Chinese Foreign Ministry spokesman said Australia should take responsibility for a “sharp decline” in relations between the two countries.
“The responsibility for triggering the situation does not lie with China at all,” spokesman Zhao Lijian said at a news conference.
“[They] subsequently, a series of wrong steps were taken in relation to China, which was the cause of the sharp decline in Sino – Australian relations and the current difficult situation. “
– Shanshan Wang contributed to this report.