CCP Eager to Improve Trade Relations With Australia as Chinese Economy Sinks Into Crisis Mode

By Kathleen Li
Kathleen Li
Kathleen Li
Kathleen Li has contributed to The Epoch Times since 2009 and focuses on China-related topics. She is an engineer, chartered in civil and structural engineering in Australia.
and Ellen Wan
Ellen Wan
Ellen Wan
Ellen Wan has worked for the Japanese edition of The Epoch Times since 2007.
February 3, 2023Updated: February 3, 2023

Australian Minister for Trade Don Farrell recently stated that Australia is committed to lifting its ban on AUD$20 billion (approx. $ 13.9 billion) worth of trade with China after the Chinese ambassador stated that China would lift the ban on coal imports from Australia. This comes as the Chinese Communist Party (CCP) attempts to improve China’s trade relations during its economic crisis.

The Australian government released the conversation between Trade Minister Don Farrell and Sky News Australia on Jan. 30. Farrell said that one of the most important things he would discuss with China was the removal of high tariffs on major Australian exports, including wine, meat, lobster, and wheat. He also said that the Chinese regime’s response had been very positive.

Before the Chinese ambassador to Australia, Xiao Qian, publicly stated on Jan. 10 that China is seeking to lift the ban on coal imports from Australia, several Chinese state media outlets had already reported that the ban on coal imports from Australia might be lifted. The Shenzhen Securities Times said on Jan. 5 that several CCP officials had met with industry leaders on Jan. 3 to discuss the resumption of Australian coal imports and that the ban would be lifted as early as April 1 this year.

In October 2020, the CCP banned the import of Australian coal after former Australian Foreign Minister Marise Payne and former Prime Minister Scott Morrison publicly called on the World Health Organization (WHO) in April 2020 to launch an independent investigation into the origins of COVID-19. The former Chinese Ambassador to Australia, Cheng Jingye, threatened serious economic consequences as a result of Australia’s push for an investigation.

Changing Foreign Policy

In the May 2022 elections, the Australian Labor Party returned to power after nine years. New Prime Minister Anthony Albanese said on Jan. 13 that China is Australia’s major trading partner and it is in the interests of both countries to continue to develop a positive relationship.

In an interview with The Epoch Times on Jan. 30, Professor Feng Chongyi, at the University of Technology Sydney, discussed the impact of increased economic and trade relations between Australia and China on future political ties between the two countries.

Feng said: “China is in a deep economic crisis with a collapsing real estate sector and shrinking government finances. The CCP is keen to improve its foreign relations to save the economy, and Australia is one of its main targets.”

Feng further said that the CCP wishes to control the entire South China Sea and to invade Taiwan, which will hurt Australia’s interests in the long run in regard to freedom of navigation in the region. At the same time, the CCP is currently expanding its influence in the Pacific Islands both economically and militarily, which also poses a threat to Australia since Australia is a U.S. ally.

Impact of China’s ‘Sanctions’

Feng pointed out that the previous Australian government established a series of policies against the CCP with strong public support, so there are factors that prevent the current ruling Labor Party from going too far to reverse any of them.

The CCP actually failed to restrict Australian coal exports in 2020 and has instead helped to create another market for Australia. Australia had largely completed restructuring its coal exports by 2021. Australia’s largest coal supplier, Glencore, exported 15.5 million tons of coal in the third quarter of 2021 (pdf), a 15 percent increase over the same period in 2020.

The Australian government’s December 2022 Resources and Energy Quarterly (pdf) shows that in the fiscal year 2021-22, the main importers of Australian metallurgical coal were India, Japan, Korea, the Netherlands, and Taiwan; the main importers of Australian thermal coal were Japan, Korea, Taiwan, Vietnam, Malaysia, and Thailand. This shows that Australia’s coal industry performed well despite China’s import ban.

In 2020, the CCP banned the import of Australian beef from four major Australian meat exporters on May 12; on May 18, it imposed an 80 percent tariff on Australian barley; on June 5, it warned Chinese citizens not to travel to Australia; and on June 9, it advised Chinese students to avoid studying in Australia. In the face of heavy pressure from the CCP, Australia’s then-Prime Minister Morrison responded that he would never sacrifice Australian values in exchange for trade with China.

CCP’s Hostage Diplomacy

Currently, two Chinese-born Australian citizens, journalist Cheng Lei and writer Yang Hengjun, have been jailed in China, without trial and without any clear reasons, for over two years. This action has strained relations between the two countries.

Professor Feng Chongyi believes that the CCP might use the two Australian citizens as bargaining chips since it does not cost China anything to release them. It is still unclear how they offended the CCP. China’s arbitrary detention of the two is another example of the CCP’s “hostage diplomacy.”

Cheng Lei, formerly a well-known Australian anchorwoman for the CCP’s state broadcaster CGTN, was formally arrested in February 2021 after being detained by the Chinese authorities on Aug. 13, 2020, in Beijing on alleged espionage charges.

Hengjun Yang, an Australian-Chinese writer, flew from New York to Guangzhou, China in January 2019 and then disappeared before the Australian government confirmed that he was detained in China. Professor Feng Chongyi was Yang Hengjun’s supervisor during his doctoral studies at the University of Technology Sydney.