What lies behind Chinas anti-dumping complaint against Australia to the World Trade Organization?
It was a bolt of lightning. On Thursday, the Chinese government suddenly announced it would file a dispute with the World Trade Organization (WTO) against Australian anti-dumping obligations on three of its exports. At first glance, the products seem to have been chosen almost randomly. Beijing said it was challenging Australian duties on Chinese steel sinks, wind turbines and rail wheels. China gave no prior notice to Australia and the old ministers were quick to publicly label the step small. Space to play or stop, M to mute, left and right arrows to search, up and down arrows for volume. Look Duration: 1 minute 1 second 1 m 1 s Trade Minister Dan Tehan says Australia will be strongly defended at the WTO. After all, the announcement came just five days after the federal government announced it would launch its complaint to the WTO against Beijings damaging tariffs for Australian wine. From his point of view, it seemed like a clear act of revenge. Dumping refers to the practice of exporting goods below their normal prices, or to gain market shareholder to get rid of surplus products. Prohibited under WTO rules and when the importing country is identified it is allowed to impose anti-dumping duties to return the goods at a normal price. Australia has imposed dozens of anti-dumping measures against goods overseas, particularly from China. This is not surprising, nor is it necessarily Australias evidence that it discriminates against China. Australias complaint to the WTO against Chinas tariffs on Australian wine may have prompted Beijings complaint. ( Flickr: Ken Hawkins  China is the largest exporting economy in the world and its economy is also overcrowded, says Richard McGregor, a China expert at the Lowy Institute. In other words, they have a lot of goods that are more manufactured, which means they are often looking for an offshore home in places like Australia.  But he says China has long been a bee on its cover over anti-dumping actions taken by Australia against its exports. They never took us to the WTO on this. I suspect they kept these cases on their sleeve to do exactly that, says Mr. McGregor. And Australias announcement of the summer case was the trigger for it.  Former Commerce Minister Simon Birmingham says Chinas complaint is small. Right now, its very hard to say. Beijing essentially claims that Australian taxes on those three products are unfair because they are not thrown away but simply sold at a fair price, above the cost of production. China suspends economic activities with Australia Beijing announces indefinite suspension of all activities under the China-Australia Strategic Economic Dialogue. Read more  A Commerce Ministry spokesman said it was taking steps to protect the multilateral trading system. China opposes the abuse of commercial remedies, which not only harm the rights and legitimate interests of Chinese enterprises, but also undermine the seriousness and authority of WTO rules, he says. But the ministry has not yet provided the details of its complaint, so experts have little material to work on. The issue is not how many times Australia has implemented these tasks in China, but whether it has done so under long WTO rules, said trade expert Jeffrey Wilson of the USAsia Center in Perth. Until the full details of the Chinese claim are published, it is impossible to say whether they have a strong case.  Steel sinks are one of three items identified by China in its anti-dumping complaint against Australia. ( Radio ABC Darwin: Jesse Thompson  The government is already making it clear it sees the complaint as frivolous and disturbing, with Finance Minister Simon Birmingham labeling the move more petty than provocative. Our systems, our processes are strong, they are transparent and they contrast with the kind of approach that was used in Chinas decision against our wine and barley, said Senator Birmingham. Dr Wilson says this is a reference to the fact that Australian politicians cannot simply hit any old product with anti-dumping fine. Australian anti-dumping duties are carried out by an independent authority, the Anti-Dumping Commission, which defines these duties after lengthy and transparent investigations, he says. Of course, this does not mean that our record is flawless. Yes there are  In 2019, the WTO backed an Indonesian complaint against Australian anti-dumping tariffs on A4 paper, concluding that Australia had made erroneous assumptions about prices. The Indonesian case was a rare loss for Australia at the WTO. ( ABC Gippsland: Robert French  The federal government did not appeal against the decision and it abolished anti-dumping tariffs. Still, Dr Wilson shows that Australias record on this front remains strong. Out of hundreds of cases, only once has a task mandated by the commission been removed from the WTO, he tells ABC. The dispute [with China] was probably created to try a diplomatic point and create a nuisance for Australian trade officials.   Mr McGregor of the Lowy Institute says it could be the case that Australias system is strong and fair. China pursued by uncertainty says DFAT chief Foreign Secretary and Commerce Secretary Frances Adamson issued a warning on China, saying insecurity and power could be an unstable combination. Read more  But he says given Australiaappliesanti-dumping fees so regularly, it would be good to have them tested again at the WTO. And he suggests China may have been encouraged by Indonesias victory in 2019. They may have seen the case of Indonesia as a precedent they can follow, he says. The complaint will also put additional pressure on the relatively small teams of diligent and already protracted Australian officials responsible for disputes like this. Even if Australia wins quietly, defending the case will waste time and energy and distract trade officials from focusing on Australias two WTO prosecutions against China for barley and wine. And that may be reason enough for Beijing to move forward, even if its prospects of victory are weak.