China’s importance to the Australian economy has exploded over the past decade, fuelled by an apparently insatiable need for iron ore and helped along by increasing demand for luxury goods as the country became richer, analysis of UN trade data by Guardian Australia reveals.
But the data shows that Australia is not nearly so important to China. The United States, Japan and Korea all import multiples of what Australia takes from China. Even relatively distant countries like the United Kingdom and Germany are far bigger markets for China’s goods.
Australia’s exports to China are now under threat from a trade dispute that since last year has seen dozens of coal ships banked up off the coast, racking up demurrage fees of tens of thousands of dollars a day as their captains wait for permission to come into port.
China has also slapped huge tariffs on imports of Australian wine, accusing producers of causing “substantial damage” to the local industry by dumping their product below cost.
It has also put steep tariffs on another big import from Australia, barley.
This isn’t just a story of population size, as Singapore, with less than six million people, imports a comparable amount from China as Australia. Russia, which shares a border with China and has a population of more than 140 million, imports only slightly less from China than Australia.
Its proximity, size and manufacturing base make China a huge customer for particular products, like iron ore. And as it has gotten wealthier over the past few decades, demand for Australian luxury goods and services such as wine, gold and travel has exploded.
Although dwarfed by exports from iron ore, Australia has become a major source of gas, wool, wine, beef and seafood over the past decade and a half.
Australia is by far China’s largest source of iron ore, coal, gas and wool. But Australia has major competitors for many luxury goods, such as wine, gold and seafood.
Services have become increasingly important to Australia’s economy, and Australia one of China’s largest travel destinations, but WTO data shows Hong Kong and the United States are both several times larger than Australia in China’s services market.