China has recently expressed a desire to collaborate with Australia to bolster global trade in response to the economic turbulence caused by US President Donald Trump’s substantial tariffs. According to a report by the Sydney Morning Herald, the Chinese government has offered to "join hands" with Australia during this time of uncertainty.
The overture comes in light of Trump’s recent move to raise tariffs on Chinese imports to an alarming 125%, coupled with a pause on his proposed "reciprocal" tariffs on other countries. As a result, Australian products entering the US market now face a baseline tariff of 10%.
China’s ambassador to Australia, Xiao Qian, has called for cooperation between Beijing and Canberra to defend international free trade. He stated, "Under the circumstances, China stands ready to join hands with Australia and the international community to jointly respond to the changes of the world." Moreover, the ambassador reaffirmed China’s commitment to implementing the strategic consensus established by the leaders of both nations.
Xiao Qian also highlighted that the Trump administration had "weaponised" trade issues. He cautioned that minor adjustments to tariffs on other countries would not be sufficient to mitigate the damage inflicted on their economies by the ongoing trade war.
This newfound offer for collaboration stands in stark contrast to the previous tensions between the two countries, which saw China impose sanctions on Australian imports such as barley, wine, beef, coal, and seafood five years ago. The context of this offer is further complicated by the escalating trade conflict that has forced Australia’s treasury and the Reserve Bank of Australia into emergency discussions, signalling that interest rate cuts could be on the horizon.
Jim Chalmers, Australia’s treasurer, briefly paused his federal election campaign to engage with Michele Bullock, head of the Reserve Bank, as markets react to the uncertainties stemming from Trump’s global tariff strategy.
As China seeks to mend ties with Australia while navigating the complicated landscape shaped by US trade policies, the focus appears to be shifting towards securing a stable economic partnership that can withstand external pressures.