Australia’s economy has shown resilience in the face of China’s trade curbs on a range of its commodity exports, Treasurer Josh Frydenberg will say in a speech Monday, with producers quick to redirect trade to other markets.

China, Australia’s top trading partner, banned imports including seafood, wine and coal, after diplomatic tensions between Beijing and Canberra flared up last year. While exports of the goods targeted have fallen by around A$5.4 billion ($4 billion), sales to other overseas markets have grown by A$4.4 billion, Frydenberg said.

“Despite China’s wide-ranging actions, our economy has continued to perform very strongly,” Frydenberg said in extracts from a speech to be delivered to a conference in Canberra on Monday. “Australian firms have pivoted, by finding new buyers for their goods.”

Both countries would be better off if markets were allowed to operate freely, Frydenberg said. “But going forward, businesses also need to be aware that the world has changed. And that this creates greater uncertainty and risk. In this respect, they should always be looking to diversify their markets, and not overly rely on any one country.”

The world has entered a new era of strategic competition, in which China is willing to use its economic might as a source of political pressure, Frydenberg said. As such, it is important to build economic resilience “from cyber risks to supply chains and everything in between.”

Source: Bloomberg

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