China-Australia relations: Canberra ‘very concerned’ over reports of ‘discriminatory’ coal ban
- Canberra is trying to verify Chinese media reports that Beijing has directed power plants not to import Australian coal
- Trade minister Simon Birmingham says, if true, the action could constitute a ‘breach of China’s commitments’ at World Trade Organization
Canberra is seeking clarification from Beijing over reports that it has blocked Australian coal imports, in what could be a “breach” of China’s commitments as a member of the World Trade Organization (WTO).
China’s top economic planning agency, the National Development and Reform Commission (NDRC), approved 10 major power generators over the weekend to import coal to address a domestic supply shortage, except from Australia, state-owned tabloid Global Times reported.
These actions, if true, would potentially constitute discriminatory action against Australian producers
“These actions, if true, would potentially constitute discriminatory action against Australian producers, potentially constitute a breach of the type of undertakings that China has made to Australia and to the world in relation to their trade practices, and potentially harm China’s ability to meet the other types of commitments it’s given to the world in relation to its emissions profile,” he said during a press conference in Sydney.
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China to Australia: Coal import restrictions are responsible for domestic industries and customers
Australian Prime Minister Scott Morrison told the media in Tasmania that the government was waiting for clarification from Beijing. Though diplomatic lines remained open, he admitted there was no timetable for direct ministerial or leader-level discussions.
Birmingham said it was unacceptable the government and Australian businesses had to find out about these decisions via Chinese media outlets.
Australia has politicised relations, violated market principles, and discriminated against Chinese companies
The Chinese Ministry of Foreign Affairs did not confirm the coal ban when asked about it on Tuesday.
However, it refuted allegations China had breached trade commitments and questioned if Australia had gone against its own promises to allow open investment and trade, after denying myriad Chinese deals in the past two years, including blocking Huawei Technologies Co. from the country’s 5G network.
“Australia regards itself as a victim and accuses China, which confuses the audience,” foreign affairs spokesman Wang Wenbin said.
“China does not accept it. Australia has politicised relations, violated market principles and discriminated against Chinese companies.”
“Interfering in the momentum of China-Australia relations is causing damage to Australia’s reputation … the violation of basic practice of international relations; this is the real thing we need to worry about.”
Morrison said the deteriorating relationship could be salvaged if both countries made an effort, but denied he had “mismanaged” the relationship.
“What our government has done has stood up for Australia’s sovereign interests” he said.
Coal traders in China and around Asia said they had not heard about an official ban or any changes to the unofficial restrictions placed on Australian coking and thermal coal imports in October, when Chinese coal import quotas for the year had been exhausted.
Commodities analysts at S&P Global Platts said at the time Russia and Indonesia would likely be the suppliers. At the same time, China signed a three-year US$1.46 billion deal with Indonesia for more thermal coal starting next year.
Australia’s hard road through WTO looks riddled with hurdles in China case
China’s decision to curb Australian coal and tighten domestic coal production to lower carbon emissions has caused coal prices to shoot up on the.
On Monday, the Chinese National Energy Administration said in November electricity consumption rose 9.4 per cent compared with the same period last year.
While Australia waits for confirmation of the coal ban, Birmingham said the government was close to finalising its case for a WTO complaint against China’s anti-dumping duties on Australian barley.
Additional reporting by Catherine Wong
