One of the world’s most powerful international organizations has issued a harsh warning to Australia about its reliance on trade with China.
Australia has issued a serious warning from one of the world’s most powerful international organizations that China’s volatile behavior will have a real economic impact.
The Organization for Economic Co-operation and Development released a report on Wednesday urging the Australian Government to find a new country to strengthen trade away from its largest trading partners.
“Over the last two decades, Australia’s share of commodity exports to China has increased from 10% to about 40%, now exceeding the total Australian commodity exports to all OECD countries,” the report said. I am.
“As export flows become more concentrated, Australia becomes more vulnerable to future shocks in the Chinese economy and import restrictions imposed on additional commodities such as iron ore.”
The OECD emphasized that strengthening trade relations with China has benefited Australian businesses, households and governments in recent years, but relying on this relation in the future is a dangerous move.
China has already used trade as a weapon to force Australia to change its strategic behaviour, imposing destructively high tariffs on major Australian exports such as wine, beef and barley.
The OECD warned that if it spreads to other important industries, it could have a devastating impact on the future of Australia’s economy.
“Additional trade restrictions by China in areas such as iron ore and education will significantly slow the pace of economic recovery,” the report said.
“(Australia) needs to explore the potential for trade shifts to other export markets and provide targeted support as affected industries move to new markets.”
The report states that resolving trade tensions with China could boost Australia’s export growth, but diplomatic relations with increasingly volatile neighbors could always worsen. I have.
China-Australia trade: OECD urges Australia to find new trading markets Source link China-Australia trade: OECD urges Australia to find new trading markets