Donald Trump’s latest China tariffs threat could breach WTO rules, says Australian trade minister
- Simon Birmingham warns during visit to Beijing that impact on global economy is a ‘more immediate concern’
Australia’s trade minister said US President Donald Trump’s threat to impose new tariffs on US$300 billion worth of Chinese goods could breach World Trade Organisation rules.
Speaking on Sky News on Sunday, Simon Birmingham said it “may well” be the case that the US would breach WTO rules.
Birmingham, who was in Beijing for trade talks, said China had launched actions in the WTO in response to previous actions by the Trump administration, and the latest threat “is something that has been announced but not yet taken effect”.
“The application of those sorts of unilateral tariff actions is not something we have welcomed and it may well be [a breach of WTO rules], but that is something for the independent process,” he said.
Birmingham said a “bigger and more immediate concern” than the process was the practical impact of the escalating dispute on global trade volumes, and on global economic growth.
In July the International Monetary Fund in Washington said its outlook was gloomier than it had envisaged three months earlier because of the trade war, Brexit uncertainty and the effect of sanctions against Iran on oil prices.
In an update to its half-yearly world economic outlook, the IMF expected global growth to be 0.1 percentage points lower in both 2019 and 2020 than it had envisaged in April, at 3.2 per cent and 3.5 per cent respectively.
Trump’s declaration last week that the US would impose 10 per cent tariffs on US$300 billion worth of Chinese imports caught financial markets on the hop, and share prices fell around the world.
With senior US officials in Australia at the weekend for defence talks, and with Birmingham in Beijing to pursue discussions around the Regional Comprehensive Economic Partnership agreement, the trade minister acknowledged that Australia agreed with some elements of Trump’s criticism of Chinese trade practices.
He said on Sunday the Australian government wanted to see further action from China on flashpoints such as intellectual property reform.
But he also stressed how important Canberra’s trade relationship with Beijing was for Australia’s economic prosperity.
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He did not have a formal bilateral meeting with his Chinese counterpart at the partnership discussions, with diplomatic relations between Canberra and Beijing strained by some of the robust commentary around Australia’s move to limit foreign interference.
He was also unable to answer a question about when the prime minister, Scott Morrison, might be invited to visit Beijing.
However, he said “despite some of the negative commentary, two-way trade remains at record levels”, including Australia’s iron ore and wine exports to China.
While the trade relationship was healthy, Birmingham was continuing to try to understand why some thermal coal shipments from Australia struggled to clear Chinese ports.
The official characterisation of the go-slow was that it was not discriminatory and Birmingham said he had asked Chinese officials to work with Australia so exporters could better understand what the checks were.
“This is an issue particular to thermal coal,” he said. “There may be some broader issues at play with China trying to manage the volumes of thermal coal coming into the country, but we do want to get to the bottom of whether it is demand management or supply management … whether it is in relation to environmental checks, and I’ve asked for us to have further dialogue on that.”
