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While Chinese trade sanctions have cost Australian exporters millions of dollars, the impact on businesses is far from crippling, according to one expert.
Trade to China across the affected commodities, including barley, beef and coal, has dropped by 78 per cent.
Sanctions were imposed on Australian exporters after relations between Beijing and Canberra plummeted over the last year.
Chinese trade sanctions against Australian exports have not had the devastating effect many anticipated, a think tank said. (Nine)
They came after Australia called for an international investigation into the origins of the coronavirus pandemic and the Federal Government introduced foreign interference legislation.
But Lowy Institute lead economist Roland Rajah said the tariffs and other sanctions against Australian exports started last year amid the COVID-19 pandemic which "significantly clouds the picture".
His analysis suggests the Australian economy has to date "dodged a bullet".
"It would seem the impact has in fact been quite limited," Mr Rajah said.
"Exports to China have predictably collapsed in the areas hit by sanctions, but most of this lost trade seems to have found other markets."
Industries targeted by Beijing - including beef, seafood, timber, barley, coal, and wine - totalled about $29 billion in 2019.
The total value of these exports to China in the three months to January 2021 was about $5.5 billion a year - a huge decline.
The Australian coal industry has been able to find alternative export markets to China. (AP)
But exporters haven't actually lost the almost $20 billion remaining in annual exports, Mr Rajah said.
"First, one must disentangle the effect of the sanctions from many other factors, including the pandemic," he said.
"Second, a fair bit of trade diversion should be expected, with global trade shuffled around as China replaces Australian imports with other sources and Australian exports shift to other markets, with some impact on prices."
Beijing's policy of targeting products that would have limited effects on its own economy - with other suppliers available - also helped Australian exporters find alternative buyers for the affected commodities.
"This reshuffling of global trade is precisely the reason the damage inflicted on Australia has been limited," Mr Rajah said.
The Australian wine industry has been hit hard by Chinese tariffs in its most valuable export market. (Getty)
He highlighted coal exports to China, which fell by $6 billion, as one example of successful diversification.
Australia's coal exports to other countries increased by $9.5 billion in annualised terms.
But wine has been unable to find a long term alternative market to the prized China market.
Last month Chinese authorities confirmed they were extending tariffs on Australia wine exports for another five years.
China has maintained the taxes - expected to be up to 220 per cent - were an anti-dumping measure.
Wine exports had dropped to less than $1 million in January, from a high of $164 million last October.
Total beef exports also declined but this is more of a reflection of supply issues after years of drought.
China trade sanctions 'failing to cripple Australian economy'
www.9news.com.au
All Australia needs to do is stop iron ore exports to China and watch the Chinese on their knees begging. LOL
