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China mulls targeting Australian wine and dairy on Covid-19 spat

Beijing also slapped anti-dumping and anti-subsidy duties totalling more than 80 per cent on Australian barley late Monday.

Hong Kong

AUSTRALIAN exports of wine, seafood, oatmeal, fruit and dairy are in danger of being targeted by China if Beijing decides to escalate a row over Canberra's calls for an investigation into the origin of Covid-19, according to people familiar with the matter.

Chinese officials have compiled a list of potential goods that it could target by implementing stricter quality checks, anti-dumping probes or tariffs, adding steps to or delaying customs clearances, or using state media to encourage consumer boycotts, the people said, asking not to be identified as the discussions are private.

Australia raised China's ire by leading calls for an investigation into the origins of coronavirus, writing to G-20 leaders to gather support for its push, as well as urging an international probe into wildlife wet markets.

A final decision hasn't been made and any additional measures will depend on how Australia addresses China's objections, the people said. China doesn't intend to publicly acknowledge a link between its trade actions and Australia's calls for an international probe, they said.

China's commerce ministry and foreign ministry did not immediately respond to requests for comment.

As tensions between the two nations have grown, Chinese officials threatened to boycott Australian goods and suspended meat imports from four processing plants for "technical" reasons.

Beijing also slapped anti-dumping and anti-subsidy duties totalling more than 80 per cent on Australian barley late Monday.

While a spokesman for China's foreign ministry said last week the beef imports were suspended "to secure the health and safety of Chinese consumers," he also criticised Australia's pursuit of a probe into the origins of the coronavirus first discovered in China.

The spokesman, Zhao Lijian, denied the two issues were connected, telling reporters in Beijing: "I don't think you should take them as one, or make any erroneous political interpretation."

Beijing's measures threaten exports to Australia's most important trading partner, with agricultural shipments alone totalling about A$16 billion (S$14.8 billion) in 2018-19, six times higher than it was about two decades ago. Diplomatic relations between the trading partners have worsened in recent years, with Australia saying Beijing's "meddling" in its government, media and education system was a catalyst for anti-foreign interference laws pass in 2018. Like the US, Australia has also banned Huawei Technologies Co from building its 5G network.

A slowdown in Australian coal imports into Chinese ports was blamed on tensions over Huawei, as was the barley anti-dumping probe that began in 2018. China has also restricted canola imports from Canada after the north American nation detained a Huawei executive. BLOOMBERG

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