Western allies gain from Australia's trade tensions with China, shows report

SYDNEY, Dec. 2 (Xinhua) -- Australia is bearing the brunt of the economic costs of heightening trade disruptions with China, while its Western allies are reaping its rewards, an Australian think tank report showed.

The report, released on Tuesday by the Australia-China Relations Institute (ACRI) of the University of Technology Sydney, detailed how Australia's deteriorating relationship with its largest trading partner had left a number of its key export industries in a lurch.

The report revealed that between 2019 and 2021, China's coal imports from Australia fell to zero, while imports from the United States increased 12 folds from 123.3 million U.S. dollars to 1.5 billion dollars. Imports from Canada also grew 2.5 times from 602.0 million dollars to 1.5 billion dollars.

The report showed this pattern had repeated itself across a number of Australia's key export industries, including but not limited to wine, timber, barley, cotton, and beef.

From January to September 2021, China's import of 12 Australian goods that were affected by the bilateral trade relationship, fell by 12.6 billion dollars, compared with 2019. Meanwhile, the United States increased the sales of the same goods to China by 4.6 billion dollars, and Canada as well as New Zealand by 1.1 billion dollars and 786 million dollars respectively.

At the same time, expressions of solidarity from Australia's allies have proved empty when it comes to stepping up their purchase of disrupted Australian goods, the report said.

In January to September 2021, sales of Australian wine to China fell by 480.5 million dollars compared with 2019, while U.S. purchases only rose by 7.1 million dollars.

Lead author of the report, Professor James Laurenceson, director of the ACRI, told Xinhua this is merely the economic reality of global commerce.

"The problem is in the world of international commerce, America isn't our mate. They are actually one of our fiercest competitors," said Laurenceson. "When Australian producers of cotton, coal and so on got locked out of the Chinese market, American producers were only too happy to pick up the slack."

"I think perhaps what the report showed was the scale that that's been happening," he said.

The report also refuted the narrative that there is a broad economic decoupling between China and the world, as well as the assessment that the cost of Australia decoupling its economy from China would be low.

"Australia cannot take comfort in disrupted trade ties with China being part of a broader, global decoupling trend. Rather, the weight of evidence points to greater economic integration between China and the rest of the world," it said.

Laurenceson said the voice of people representing Australia's economic interests needs more attention from the government, and Australia would need to face the economic reality of its foreign policy.

"Until we have some political leadership in both countries that recognize that, and are willing to act on that, I think it's going to be tough times ahead," he noted.