China Ban On Meat Imports From Australia A Reminder of Beijing’s Ability to Inflict Economic Pain
By
Stephen Dziedzic
China’s sudden announcement it was suspending imports from four Australian abattoirs sent a ripple of unease through the Federal Government. But it probably didn’t come as a shock.
Australian officials and politicians hoping for an explanation were treated to a predictable piece of theatre from Zhao Lijian, the famously combative spokesman for China’s Ministry of Foreign Affairs.
The Australian abattoirs were guilty of “repeated violations of inspection and quarantine requirements” Mr Zhao declared.
The issue had nothing to do with China’s increasingly sour relationship with Australia, he insisted. The Chinese Government was merely “safeguarding the health and safety of Chinese consumers”.
But this assertion ignores history and stretches credulity.
The reality is Beijing has a long track record of economic coercion, and the pattern is strikingly similar across the globe: Countries caught in a dispute with Beijing suddenly find their flagship industries hit with obscure regulatory roadblocks.
Zhao Lijian said the abattoirs had violated inspection and quarantine requirements.
When Norway awarded a Nobel Peace Prize to Chinese dissident Liu Xiaobo, the authorities in China slapped fresh import controls on one of its iconic exports, Norwegian salmon.
When South Korea angered Beijing by installing a US missile defence system, one of its major supermarket chains suddenly found most of its Chinese branches shut down over “safety violations”.
The aim is not to financially cripple the other country, but to remind them how easily Beijing can impose economic pain. It’s an implicit threat designed to shape behaviour.
And as academics Darren Lim and Victor Ferguson point out, Beijing likes to use “quarantine restrictions” to punish countries because it allows it to de-escalate without appearing to back down.
“Informal retaliation provides plausible deniability against any charge of violating international trade rules, or accusations of explicit economic bullying,” they write.
China’s threatened beef export suspension comes straight from this playbook.
Trade dispute just the latest in a series
There’s another reason the Federal Government might not have been shocked by Monday’s sudden announcement.
Only two weeks ago, China’s ambassador to Australia warned the Government its pursuit of an international inquiry into the coronavirus outbreak could spark a consumer boycott in China.
And last week Beijing announced it was preparing to slap massive tariffs on Australian barley exports, accusing the industry of dumping its product at artificially low prices.
Yes, the trade dispute over barley has been rolling on for more than 18 months and was always likely to come to a head around now.
And no, the beef ban is not unprecedented; as sceptics point out, Beijing imposed a ban on chilled beef back in 2017 when the Australia-China relationship was much warmer.
But when someone drops a hammer three times in quick succession, it’s probably time to start looking for a nail.
That’s particularly true when you consider just how thin China’s case against the Australian abattoirs looks at first glance.
Both the meat industry and Trade Minister Simon Birmingham insist the “serious violations” raised by Beijing are isolated labelling errors which have, in any case, been largely corrected.
Yes, it’s possible this is all a coincidence, an unlikely confluence of bad luck and bad timing.
But it’s not likely.
The Minister’s cool, calm, collected approach was a smart one
Whatever its precise motivations, China’s latest manoeuvre has fed into the growing distrust between Beijing and Canberra, bringing a flurry of headlines about how the relationship is plunging to icy new depths.
The Federal Government is scrambling to defuse the situation, but also seems determined not to bend the knee.
Senator Birmingham has embraced cool-headed restraint, insisting he takes China at its word and pledging to fix the problems identified by the Chinese authorities.
This is a smart negotiating tactic. If Senator Birmingham escalated the dispute and accused Beijing of economic coercion his chances of finding a resolution would quickly dwindle to zero.
The losers would be the workers and farmers across Queensland and Northern New South Wales who are feeding China’s enormous appetite for Australian beef, and who stand to lose exports worth hundreds of millions of dollars.
There’s also an uneasy feeling in Canberra that the Chinese Government is preparing more punishment.
The provocative Chinese Communist Party tabloid The Global Times newspaper has already warned Beijing could punish Australia by turning back our mineral exports — a truly nightmarish proposition.
The Coalition seems confident Beijing would not contemplate taking that step, particularly as it would come at a steep cost to its own economy.
But other big agricultural industries which rely on China — including dairy and wine — are feeling nervous.
And Senator Birmingham’s straight-faced expressions of good faith will begin to collapse under the weight of evidence if China decides it should target yet another Australian exporter with fresh sanctions.
The Kilcoy Pastoral Company-owned abattoir is one of the meatworks affected.
One more thing that is worth remembering is Australia is not the only nation struggling to deal with an increasingly belligerent China.
In fact, Beijing has picked fights with a dizzying array of countries since the beginning of the year.
It has lectured New Zealand over its support for Taiwan and hectored both Germany and France over their handling of the coronavirus crisis.
Its Ministry of Foreign Affairs has even dabbled in Russian Government-style misinformation campaigns, circulating conspiracy theories that coronavirus may have been brought to China by the US military.
But while the Chinese Communist Party and its official and semi-official mouthpieces regularly warn countries about the risks of crossing Beijing, it has only rarely followed through.
The Federal Government seems to be betting that all it needs to do is hold its nerve and hold the line.
Farmers and exporters across the nation will be nervously hoping the Coalition has made the right call.
