China-Australia relations: WTO trade disputes rehash old question of whether China is a ‘market economy’

One analyst calls ‘market economy’ debate a moot point, because United States and others will not treat China as such in anti-dumping cases

The general hope is that arbitration proceedings at the World Trade Organization could serve as a forum for Beijing and Canberra to work out their differences

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China and Australia both filed complaints at the World Trade Organization just one day apart this week, over mutual anti-dumping duties imposed on each other’s goods. Photo: AFP

Published: 4:30am, 1 Jul 2021Updated: 5:47am, 1 Jul 2021

China’s long-demanded recognition as a market economy has resurfaced in Beijing’s complaints to the World Trade Organization about anti-dumping duties that Canberra has imposed on Chinese wind towers, railway wheels and kitchen sinks, according to officially lodged documents.

China and Australia both filed complaints at the WTO just one day apart this week, over mutual anti-dumping duties imposed on each other’s products, as the two nations continue their back-and-forth bilateral battle.

In its complaint lodged on Tuesday, Beijing said Canberra had wrongly determined that China’s market conditions were “distorted” and that Canberra did not use the correct financial data in determining that China’s exports had been dumped in the Australian market.

This followed Canberra’s complaint to the WTO on Monday about Beijing’s anti-dumping duties imposed on Australian wine exports – a complaint that centred on China’s conduct in allegedly failing to examine or review the accuracy and adequacy of evidence provided by Australia. Canberra also said China had not used the correct data and methodology to support its findings, and also decried the lack of transparency with which China’s investigations were conducted.

China’s complaint marked the first time it had disputed Australia’s anti-dumping duties.

Australia initiated 85 investigations into Chinese products between 1995 and 2020. China initiated four cases during that span, and Australia disputed them all.

Anti-dumping duties are protectionist penalties that a government can impose on exports that it deems to be priced lower in its market than in the exports’ home market.