Australia's Trade with China

Abstract

TRADITIONALLY, trade between Australia and China has hardly ever been of much importance to either country. In pre-communist days China took about 1 per cent of Australian exports and supplied an even smaller proportion of Australian imports. For almost a decade after the communist takeover, trade between the two countries dwindled to a trickle. But then in the late 1950's China entered the Australian wool market, and in 1960 she began her rather spectacular wheat purchases. In odd years she has also bought large quantities of barley, oats, tallow and iron and steel. China now takes 6 per cent (or about Aj£70 na. annually) of Australian exports, but supplies less than I per cent (A£5 m.) of Australia's import needs. Contrary to what one might be inclined to think, this trade, however small in absolute terms, carries significant consequences. On the one hand, Australia has risen to the position of the third most important supplier of China's import needs. On the other, China is now the fifth most important customer for Australian exports; she has been the number one buyer of Australian wheat for three years, and in the last two years she absorbed one half of Australian wheat export. She also takes one third of Australia's export of tallow, and occasionally about the same proportion of barley and oats. China has a virtual monopoly in supplying Australia with tung oil (for certain types of paints), bristles, certain textiles (such as pillow cases). Besides, this trade involves considerable political implications. The purpose of this article Jus to highlight the dilemmas which this trade poses to Australia. Time and again there are waves of public criticism in Australia concerning the 'China trade'. The following arguments have been marshalled against trading with China.