China has agreed to review the tariffs it places on Australian wine producers after a breakthrough in negotiations before Anthony Albanese’s trip to Beijing next month.
Albanese said on Sunday the two countries had agreed to suspend their long-running World Trade Organization dispute while Beijing undertakes an “expedited review” of duties, which is expected to take five months.
If the sanctions are not removed at the end of the review, Australia will resume the dispute.
Albanese said the government was “confident” of a successful outcome.
“This is a very significant decision because, unlike some of the other products, the wine industry has indicated it was having difficulty finding other markets to fill the gap that was created by the breakdown in the trade with China,” he told reporters in Canberra on Sunday. “So this is critical.”
The announcement comes after weeks of speculation in Canberra that a breakthrough was imminent. It was also expected the WTO would release its ruling on Australia’s complaint to the two countries.
Beijing slapped trade sanctions on $20bn worth of Australian products at the height of a diplomatic feud in 2020, including tariffs of between 107% and 212% on Australian wine.
Relations have improved since the election of the Albanese government, with China lifting tariffs on Australian barley in August.
Australian wine exports to China were valued at more than $1bn before the tariffs were put in place but that figure has plunged to $12m.
The opposition foreign affairs spokesperson, Simon Birmingham, welcomed Sunday’s news but said “these tariffs should never have been put in place in the first place”.
Birmingham said he was confident a recent draft WTO report delivered to both governments would have found the tariffs in breach of the Australia-China free trade agreement.
“It was an attempted economic coercion by China,” he told ABC TV’s Insiders program on Sunday.
Beijing proposed a package deal last month to lift tariffs on Australian wine while demanding tariffs be lifted on three Chinese products – including wind towers used to build wind turbines.
The agriculture minister, Murray Watt, said at the time he regarded the issues as “entirely separate” but would continue working to resolve the dispute through dialogue.
Guardian Australia reported on Friday the Anti-Dumping Commission had quietly released a report recommending tariffs on Chinese wind towers expire on 16 April 2024.
The commission said it was “not satisfied” that scrapping the tariffs would cause “the material injury that the measures are intended to prevent”.
China’s commerce ministry welcomed the proposed move, saying it was “conducive to deepening bilateral cooperation in the clean energy sector”.
Albanese on Sunday insisted the wine tariff development was not “transactional”.
The latest breakthrough comes after China freed the Australian journalist Cheng Lei, who had been detained in Beijing for three years after being accused of national security-related offences.
Albanese, who is travelling to the US this week, confirmed on Sunday he would visit China from 4 to 7 November.
He will meet with the president, Xi Jinping, and the premier, Li Qiang, in Beijing in addition to attending the China International Import Expo in Shanghai.
It will be the first visit to China by an Australian prime minister since 2016.
The trip will mark the 50th anniversary of the first visit to China by the then prime minister, Gough Whitlam, in 1973.
