Australia and China are currently in a trade war which appears to be worsening. China announced bans and tariffs on Australian imports such as wine, barley, beef, coal and more. Although it is clear that Australia will suffer from these changes, experts are suggesting that China will also experience consequences
For example, while Australian farmers could be suffering a loss of up to $330 million, China’s loss due to its reliance on Australian barley could be upwards of $3.5 billion. Australia’s agricultural production would also be able to be diversified if China is no longer buying large quantities of certain foods, which will lead to an increase in the export of other agricultural products.
Calculations have suggested that once Australia diversifies production, agricultural export to other countries can make up for the loss of trade with China. While on the other hand, China will be required to produce more of certain foods (such as barley) themselves which would result in lower returns for their products.
In the end, both countries will be suffering the consequences of the trade war. While experts have estimations as to what might take place down the line, we will simply have to sit back and watch to see who is right and who is not.