Chinese consumers still love Australian products despite dispute – Sydney Morning Herald

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2.Dec, 2020 0 news

Chinese consumers still love Australian products despite dispute – Sydney Morning Herald

The research is expected to bolster calls for the Australian business community to hold the course on the Morrison government’s foreign policy. The Coalition is coming under increasing pressure from Labor and business groups to negotiate with the Chinese government to give exporters relief from months of trade strikes over Australia’s positions on Huawei, Hong Kong and a dozen other grievances.

Meat imported from Australia and Brazil is displayed at Yonghui Superstore in eastern Beijing’s Tongzhou District.

Meat imported from Australia and Brazil is displayed at Yonghui Superstore in eastern Beijing’s Tongzhou District.Credit:Sanghee Liu

Treasurer Josh Frydenberg on Wednesday said China’s ongoing trade dispute with Australia was “a very serious situation” less than a fortnight after he called for respectful engagement with Beijing.

The Chinese Communist Party has largely targeted non-consumables like barley, coal and cotton for trade strikes to heap economic pressure on Australia to change its policy positions on Huawei, Hong Kong and a dozen other issues. But it has also hit importers with restrictions on Australian wine and beef, reducing their availability through labelling infringements and crippling tariffs after ambassador Cheng Jingye warned in April that Chinese consumers would turn away from wine, beef and universities.

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HSBC Bank non-executive director Carol Austin on Tuesday questioned why Australia had exposed its economy to retribution from China. “Business is not being an apologist for China but it is not clear why we have handled it so differently,” she said.

Former prime minister Malcolm Turnbull said the government should hold its nerve and trade levels would be restored once China failed to achieve policy concessions.

“China does not buy our goods because they like kangaroos or koalas,” he said at a McGrathNicol event on Tuesday. “They buy them because they are good quality.”

The CLSA survey showed the quality, value and natural attributes of Australian wine, beef, dairy and health food products make up between 55 and 65 per cent of the reason why Chinese consumers choose them.

Chinese travellers and students are also set to defy their government’s warnings not to travel to Australia when international flights resume after Australians were accused of racism following the COVID-19 outbreak.

Australia’s suppression of the coronavirus is likely to have had a more significant impact on tourists and students than political messaging.

CLSA found that only 7 per cent of respondents said studying in Australia would be less appealing over the next year, that is far lower than the 49 per cent who felt more negative towards studying in the US where the coronavirus remains rampant.

The data offers some relief to the Australian university sector which faces a $16 billion hit from the combination of the coronavirus pandemic and travel restrictions. Chinese students make up 37 per cent of all higher education enrolments.

Four Australian abattoirs were hit with import suspensions in May, following the Morrison government’s calls for an independent inquiry into the coronavirus. Australia exports $3 billion worth of beef to China each year.

CLSA found 23 per cent of Chinese consumers still intended to purchase more Australian beef.

But the report also reveals how vulnerable key exports are to government shutdowns. CLSA marked Treasury Wines for untapped potential in the Chinese market in September, finding its signature label Penfolds had the sixth highest name recognition in China. Australian wines were the second most popular overall.

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That market has all but been wiped out within two months through tariffs of up to 200 per cent.

The research found that residents of smaller cities were more positive about Australia while residents of tier-one cities like Beijing and Shanghai were, on balance, more negative. By age segment, those under 40 were more positive towards Australian products.

Prime Minister Scott Morrison on Tuesday used Chinese social media service WeChat to send a message directly to the Australian-Chinese community. He said the dispute did not “diminish respect and appreciation for the Chinese community in Australia or our friendship with the people in China”.

CLSA said that up to 10 per cent of Chinese respondents had a close relative living in Australia. The data suggest direct appeals to the Chinese diaspora may become a useful diplomatic back channel as ministerial contact is shutdown.

“No other country had as high a proportion of close relatives than Australia,” the research found.

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