China Imposes Trade Restrictions On Commodities From Australia

Bilateral relationship between China and Australia has deteriorated in 2020. Amidst the disrupted markets by the unprecedented Covid-19 pandemic, the intensifying tensions between the two governments have caused additional uncertainties for businesses in both China and Australia. With guidance from your econs tutor Singapore in econs tuition Singapore, discuss the economic disruptions caused by the Covid-19 pandemic.

Significant Decline In Exports To China

Except for iron ore which has seen record prices and record export volumes, overall export from Australia to China was down by over 13 per cent in October 2020 as compared with the same period last year. If we exclude iron ore from our calculation, export to China was down by 24 per cent year on year. You may consult your econs tutor Singapore in your econs tuition Singapore class about its negative impact on Australian businesses.

Chinese market is of pivotal importance to businesses in Australia as it is Australia’s largest trade partner which accounts for over one third of its overall exports and close to 20 per cent of its imports. Earlier this year, amidst the deteriorating relationship between the two countries, Chinese government imposed restrictions on Australian exports worth of $15.2 billion which cover a wide range of commodities. These include copper ore, coal, lobster, as well as others. Trade restriction is a double-edged sword. In consultation with your econs tutor Singapore in econs tuition Singapore, explain why both businesses in Australia and China will be affected by the trade restrictions imposed.

As a result, Australia’s export of copper ore plunged for two consecutive months in October and November 2020. In October 2020, export of the commodity plunged by over 50 per cent from September 2020. In November 2020, some 27,000 tons were exported to China, down 34 per cent from October 2020 and 78 per cent from November 2019. China is the world’s biggest consumer of copper ore. Its total imports of copper ore from all countries were 1.83 million tons in November 2020, an increase of 8.3 per cent from October 2020. Australia is China’s fifth largest supplier of copper ore, after Chile, Peru, Mongolia and Mexico. Edmund Quek is the best econs tutor Singapore. The econs tutor Singapore is renowned for incorporating real world events into his econs tuition Singapore. To find out more about this econs tutor Singapore and his econs tuition Singapore, you may visit his website at

Contributing Factors To The Deteriorating Relations

The relationship between China and Australia took a downturn in 2018, when Australia became the very first country to ban the 5G technology for the country’s wireless networks provided by smartphone makers Huawei and ZTE from China. 5G networks promise faster data downloads and uploads and better internet connectivity, among other benefits. However, it is regarded a national threat by countries such as Australia, Canada and the United States of America due to data security concerns. You may discuss with your econs tutor Singapore in your econs tuition Singapore the pros and cons of 5G networks as compared with 4G networks.

The relationship between the two countries worsened earlier this year when Australia joined hands with European Union to push for an inquiry into the origin and spread of the Covid-19 pandemic at the WHO meeting in May 2020. Their draft resolution gathered support from 116 countries, not too far from 129, two thirds of a total of 194 members required for the resolution to pass.

In an address to Australian Parliament in 2014, President Xi Jinping acknowledged the traditional differences between China and Australian in history, culture and social systems. He called on both governments to “keep to the right direction of bilateral relations, seek common grounds despite the disagreements and meet each other half-way”. Recently, Australian Prime Minister Scott Morrison has also stressed his willingness to resolve tensions between the two countries by having open dialogues. However, neither party has shown any sign of budging. It is likely that the non-negotiable differences will remain and the antagonistic relations will continue into 2021.

Linda Geng

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