Beijing Again Hints at Coal Import Restrictions as Australia, US, and UK Shore Up Military Alliance

U.S. President Joe Biden (C) speaks alongside British Prime Minister Rishi Sunak (R) and Australian Prime Minister Anthony Albanese (L) at a press conference during the AUKUS summit at Naval Base Point Loma in San Diego, Calif., on March 13, 2023. Jim Watson/AFP via Getty Images

News Analysis

Chinese authorities ended an unofficial ban on Australian coal import earlier this year, but Australia’s recent efforts to strengthen its defense force angered China’s communist leaders.

The U.S. State Department on March 16 approved a possible Foreign Military Sale of up to 220 Tomahawk cruise missiles to Australia. This approval came just three days after the leaders of the United States, United Kingdom, and Australia announced a trilateral agreement enabling Australia to purchase nuclear-powered attack submarines from the two nuclear powers.

On March 14, the day after the release of the trilateral agreement, China’s state media warned that as Beijing recently lifted all remaining restrictions on Australian coal imports, “Australia ought to cherish this special opportunity.”

Strengthening Australia’s Defense

On March 13, Australian Prime Minister Anthony Albanese, U.S. President Joe Biden, and British Prime Minister Rishi Sunak announced an arrangement for Australia to acquire a conventionally-armed, nuclear-powered submarine (SSN) capability. This project is considered the first major initiative under the Australia-UK-United States (AUKUS) enhanced security partnership. Over the next decade, both Australia and the UK plan to build and utilize the SSN-AUKUS within their respective nations.

U.S. President Joe Biden (C) participates in a trilateral meeting with British Prime Minister Rishi Sunak (R) and Australia's Prime Minister Anthony Albanese (L) during the AUKUS summit at Naval Base Point Loma in San Diego, Calif., on March 13, 2023. Jim Watson/AFP via Getty Images

The three leaders attended an outdoor ceremony at Naval Base San Diego, California, on the same day. Sunak remarked: “In the last 18 months, the challenges we face have only grown. Russia’s illegal invasion of Ukraine, China’s growing assertiveness, the destabilizing behavior of Iran and North Korea all threaten to create a world defined by danger, disorder, and division.”

The Australian government issued a media statement on March 14.

“Today’s significant AUKUS announcement about Australia’s acquisition of nuclear-powered submarines is the single biggest investment in our defence capability in our history and represents a transformational moment for our nation, our Defence Force and our economy,” it said.

On the same day, Chinese state media commented on the deal, warning that Australia “ought to cherish this special opportunity,” referring to China recently resuming the imports of Australian coal after a two-year ban.

The Coal War

The Chinese Communist Party (CCP) banned imports of certain Australian goods in 2020 in retaliation for Canberra’s insistence on investigating the origin of COVID-19. The former Chinese ambassador to Australia, Cheng Jingye, openly threatened that Australia’s push for an international investigation was offensive and would lead to serious economic consequences.

On May 12, 2020, the CCP banned imports from four Australian beef plants. A week later, it began imposing an 80 percent anti-dumping and anti-subsidy tariff on Australian barley. On June 5, 2020, it warned Chinese citizens “not to travel to Australia”; on June 9, it warned Chinese students to reconsider going to Australia to study because of a string of “incidents of discrimination” targeting people of Asian descent.

In response, then-Australian Prime Minister Scott Morrison stated, “I’m never going to trade our values in response to coercion from wherever it comes.”

The CCP then further increased the ban on the import of Australian coal in October 2020.

Port of Hay Point terminal exporting thermal and metallurgical coal in Queensland, Australia, in March 2021. Jackson Stock Photography/Shutterstock

China’s ban on Australian coal has driven Australia to develop alternative export markets. By 2021, Australia had largely completed restructuring its coal exports. Glencore, the country’s largest coal supplier, exported 15.5 million tonnes of thermal coal in the third quarter of 2021, an increase of 15 percent over the same period in 2020.

In 2022, the primary importers of Australian metallurgical coal included India, Japan, South Korea, the Netherlands, and Taiwan, while the leading importers of Australian thermal coal were Japan, South Korea, Taiwan, Vietnam, Malaysia, and Thailand.

CCP Warns Australia Following Submarine Agreement

On Jan. 26, 2022, the new Chinese ambassador to Australia, Xiao Qian, issued a public statement immediately after he landed in Sydney, saying that he hoped to “enhance mutual understanding and trust” and “eliminate misunderstanding and suspicion.”

In May 2022, the Australian Labor Party returned to power after nine years, and Albanese became the new prime minister. Bilateral relations between Australia and China began to ease gradually after the power transition.

On Jan. 3, 2023, China’s National Development and Reform Commission allowed four state-owned companies to resume coal imports from Australia.

However, the CCP is not pleased with the recent trilateral submarine agreement.

“Just as China’s customs is fully resuming the import of Australian coal, the leaders of the United States, UK, and Australia held talks on AUKUS and announced plans to equip Australia with nuclear submarines,” Chinese tabloid Global Times reported.

Moreover, the article said that Australia should “cherish the special opportunity” of recently improved China-Australia trade relations.

CCP Has No Bargaining Power

Li Yuanhua, a former associate professor at Capital Normal University in Beijing, told The Epoch Times on March 17 that Australia, the United States, and the UK have had a long-standing strategic partnership, with Australia sending troops in both World War I and World War II.

“After the Labor Party came to power, Australia-China relations have eased, mainly for economic reasons, but this has allowed the CCP to take advantage of it. The CCP has a long history of infiltration in Australia. But now that the general public is strongly against the CCP, the Labor government will have to exercise caution when dealing with this issue,” he said.

Li also pointed out that the CCP’s import ban on Australian coal has not impacted the export of Australian coal.

“The CCP won’t have a way to effectively retaliate if Australia insists on taking a tough stance toward it,” he said.