China and Australia end 'barley war' after 3 years

China’s Ministry of Commerce announced on August 4 that it will lift anti-dumping and anti-subsidy tariffs on barley imported from Australia, effective from August 5, amid changes in China’s barley market, Reuters reported.

Following the announcement from China, Australian Foreign Minister Penny Wong said Canberra would drop its WTO case against Beijing over the tariff policy.

"We welcome this outcome. This will pave the way for our barley exporters to re-enter the Chinese market, benefiting Australian producers as well as Chinese consumers," AFP quoted Ms. Wong as saying in a statement on August 4.

China has imposed tariffs on barley imports from Australia for the past three years.

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While tariffs on Australian barley will be lifted, other Australian products will remain subject to Chinese restrictions, including wine, which is also subject to high tariffs. Lobster and meat exports from some Australian slaughterhouses to China have also been hampered.

“The barley outcome demonstrates the importance of the WTO dispute settlement mechanism in protecting the interests of Australia’s world-class producers and farmers. We have made it clear that we expect a similar process to be followed to remove tariffs on Australian wine,” the three Australian ministers said in a joint statement.

Relations between Australia and China soured in 2020 after Canberra called for an investigation into the origins of the Covid-19 pandemic, leading Beijing to impose tariffs on key Australian exports such as barley, beef and wine that same year. Australia responded by taking China to the WTO, although the case was suspended this year as trade ministers from both countries pressed ahead with talks.

Tensions between Canberra and Beijing have eased since the center-left Labor Party came to power in Australia last year. In January, China resumed buying Australian coal, and in May, Beijing also announced it would start importing Australian timber again.

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