As the Sino-Australian trade tension continues, some people have called on Australia to focus on markets outside of China.
ABC News: GFX/Jarrod Fankhauser
In the ongoing trade dispute between Canberra and Beijing, China has shown a non-committal attitude. Chinese officials blame Australia for today’s tensions.
Zhao Lijian was also asked about his response to the comments made by Australian Trade Minister Simon Birmingham (Simon Birmingham) earlier this month. Senator Birmingham previously stated that “China is the decision-making power” when discussing trade issues with China.
For months, federal government ministers have been unable to talk to Chinese ministers on the phone, and Senator Birmingham has been calling on Chinese officials to talk directly with the Australian government.
"The current serious difficulties facing China-Australia relations are something China does not want to see, and the responsibility for this situation lies entirely with China," said Zhao Lijian.
What are the alternative markets in Australia?
Some Australian products are easy to find in other markets, but not all.
Landline: Kerry Staight
According to statistics from the Ministry of Foreign Affairs and Trade, China is undoubtedly Australia's largest export market and two-way trading partner.
In the 2018-19 fiscal year, China was the destination of 32.6% of Australia’s exports of goods and services, with exports amounting to US$1347 billion-Japan was Australia’s second largest export market in that fiscal year, accounting for 13.1% of total exports. 591 billion US dollars.
During the same period, Australia's other top export markets were South Korea, the United States, India, New Zealand, Singapore, Taiwan, the United Kingdom and Malaysia. These countries accounted for 2.5% to 5.9% of Australia's exports.
These countries and countries such as Indonesia and Vietnam may be potential alternative markets for Australian products that can no longer enter China.
However, simply finding other places to sell goods and services is easier said than done.
Supplied: John Kruger
"China [Gross Domestic Product] is expected to grow by 1.9%, the United States will go backwards by 4.3%, the Eurozone will go backwards by 8.3%, India-the biggest hope to replace China-will go backwards by 10.3%, and even ASEAN will go backwards by 3.4%. " He said.
Dr. Lawrence said that although the political tension between Australia and China intensified in 2020, exports to China still accounted for a higher proportion of total exports than ever before.
"In the first nine months of this year, 9% of our merchandise exports went to China, up from 40.5% last year." He added that the cost of entering new markets is also worrying.
Dr. Shi said that if exporters choose to sell in alternative markets, they also need to consider the factor of declining profits.
"If Australia exports goods to some alternative markets, because of lack of demand, prices must fall," he said.
"You should expect profits to fall."
Industries that profit from the high profit margins that Chinese consumers are willing to pay will find this particularly difficult, which further strengthens the call for companies to achieve market diversification.
ABC South East SA: Isadora Bogle
"If you are a grain grower and you sell grain on the global market, whether you sell to China or anywhere else, the prospects may be good-because there are many buyers, and you have a fairly standardized product ," Dr. Lawrence said.
"But if you are a lobster fisherman, it becomes more difficult, because China is a country that is extremely willing to pay a much higher price for your output than any other country [product]."
Will other markets be better than China in the long run?
Under Xi Jinping's leadership, China has become increasingly arbitrary.
In the political dispute with Canberra, China deliberately targeted Australian exporters, which led some people to question whether the risks associated with trading with China have become too high.
Dr. Lawrence said that although the possibility of China's use of coercive measures against Australian companies is "absolutely a real risk", he does not believe that alternative markets will be a safer choice.
"When you enter the alternative market, you have to deal with other types of risks, such as Vietnam-guess what, it is also a dictatorial, one-party communist country," he said.
"India is a highly nationalist market with very poor protection of intellectual property rights.
"China brings risks - yes, these risks have increased - but how does this compare to other countries?"
Dr. Lawrence believes that companies need to hedge their risks by looking for more comprehensive risk mitigation strategies, rather than "simply reducing sales to China."
"Finance has a basic rule: Don't put all your eggs in one basket," he said.
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