Resources Minister Rejects Senator’s Call to Impose Counter Tariff on Chinese Iron Ore Exports

A container ship is pushed to its berth by a tug at the Port of Melbourne, Australia, on June 6, 2018. (William West/AFP via Getty Images)

Federal Resources and Water Minister Keith Pitt has dismissed a suggestion from Nationals Senator Matt Canavan to impose a one percent tariff on Chinese iron ore exports as a counter to ongoing trade sanctions from Beijing.

According to Canavan, a counteractive duty would generate over $800 million a year. Canavan suggests this money could then be used to compensate other Australian industries harmed by the trade disruptions.

“[E]very time China takes further action against Australian exporters, the levy would go up. We could signal that the levy would be removed if China ended its unjustified trade restrictions,” Canavan wrote in The Australian on Monday.

He also stated that the only way to stop further trade restrictions would be for the federal government to make the Chinese Communist Party (CCP) “pay a price.”

However, Pitt does not support the idea. Rather he hopes that the CCP will choose to adhere to World Trade Organisation rules.

“Australia will continue to adhere to its WTO and bilateral trade commitments, and it is our expectation that our trade partners including China would do the same,” Pitt told The Epoch Times in an email.

Federal Resources and Water Minister Keith Pitt in Sydney, Australia on Oct. 6, 2017. (Cameron Spencer/Getty Images for Tourism Australia)

The CCP has applied an array of tariffs and bans to Australian imports this year after Australia sought an inquiry into the origins of COVID-19. So far beef, barley, timber, cotton, coal, lobster, and wine have been hit.

However, one of Australia’s biggest exports to China, iron ore, has not been targeted.

In 2019, China sourced just over 60 percent of its iron ore from Australia—the world’s leading exporter of iron ore and coking coal which are both needed for steel production—for its steel production industry.

Iron ore is one of many products that have assisted China’s economic development throughout the last two decades, and in turn, provided Australia with a big customer base eager for high-quality goods.

Prof. James Laurenceson, a China expert from the University of Technology Sydney, told The Epoch Times that China and Australia’s iron ore trade is oftentimes misconstrued as the latter dependant on the communist state.

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“The trade relationship is a mutually beneficial one, and for some goods like iron ore, the dependence runs both ways,” Laurenceson, the director of the Australia-China Relations Institute (ACRI), said. “To say that Australia is solely dependent on China misses important realities in the economic relationship.”

The news comes days after federal trade minister Senator Simon Birmingham hit back at the Chinese regime for adding further bans to lamb and timber, with threats also made to the cotton industry.

Birmingham told Nine’s Today Show on Dec. 10 that China’s level of engagement amidst trade tensions has been unacceptable.

Beijing’s actions are “not in the spirit” of its commitments to Australia and the world as a member of the WTO, he said.

“Other countries have faced similar types of trade practices from China in the past and this just heightens the risk in terms of many businesses in choosing to trade with China,” he said, adding that this is why Australia has opened up a number of trade agreements with other countries.