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Posted: 2021-03-26 13:01:00

Beijing’s penultimate trade strike on Australia over national security and human rights disputes has led to a flood of cheaper lobster into the Australian market. But no amount of domestic demand from a country of 25 million will ever replace the live-seafood appetite of a country of more than 1.4 billion. Many lobster farmers have left the water, some might never return.

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And it is not the only economy dealing with a domestic rush of an unusual commodity over international trade tensions.

The lobster farmers of Australia have more in common with the pineapple growers of Taiwan than they realise.

In Taipei, President Tsai Ing-wen’s government remains untouchable in the polls. It wants to remain separate from Beijing despite the growing military, economic and political threats from the superpower, which views it as an “inalienable part” of the mainland.

Frustrated by the lack of public and political appetite for its One-China policy, Beijing sent dozens of warplanes towards its island neighbour in the first months of this year. Then it banned Taiwan’s pineapple exports.

Like Australia, the official reason given by Chinese customs was for technical infringements. Authorities said pests were found in exports or enhanced COVID-19 testing was blamed. But both the Australian and the Taiwan governments deny these claims and say they are part of a pattern of economic intimidation.

“Taiwanese have spontaneously purchased domestic pineapples to reaffirm our solidarity,” says the mayor of Tainan City Council, Huang Wei-che. The area is home to the second-largest number of pineapple exporters in Taiwan.

There is pineapple in soup, pineapple wine, pineapple tarts and #FreedomPineapple, the hashtag used on Twitter by Taiwan’s Foreign Minister Joseph Wu to whip up a surge of consumer nationalism.

“I urge like-minded friends around the globe to stand with #Taiwan & rally behind the #FreedomPineapple,” he said on Twitter in February.

The hashtag was itself taken from the fourth Australian export out of half-a-dozen last year to be hit by Chinese trade restrictions: #Freedomwine. Australia’s $2 billion-a-year wine trade with China was knocked out by tariffs of between 100 and 200 per cent over allegations it had been dumped at discount prices in the Chinese market. The Australian industry and the government have refuted those claims.

Huang says it is time to trade more Penfolds and lobster for pineapple. “In my opinion, it will certainly be a win-win situation if countries with a common vision can share with each other’s signature products,” he says.

Chung-Hsiu Hung, the chairman of Taiwan’s agricultural peak body, Mitagri, says if Chinese authorities don’t want to allow the imports of Australian wine and lobster, “we will eat it!”

“The more unreasonable the restrictions the more it will summon the consumers together,” he says.

“The pineapple saga tells us, ‘don’t put all your eggs in one basket,’ and the risk resilience for the industry is a crucial issue and challenge we need to cope with.”

Fiona Fan, the director-general of Taiwan’s de facto consulate, the Taipei Economic and Cultural Office in Sydney, says the trade disruptions have left many Australian and Taiwanese exporters in a state of uncertainty.

“As both are staunch supporters of free trade and market economy, Taiwan and Australia could work together to maintain the well-functioning of the multilateral trading system,” she says.

But for all the best intentions Taiwan-Australia food diplomacy remains beset by structural difficulties.

Two trade-dependent island countries, similar in disposition and population, find it impossible to meet for dinner at the highest levels because of the great power games going on around them.

Taiwan is Australia’s 10th largest export market but there is no free trade deal with the island. Nor is there one on the horizon. A formal deal that could effectively recognise Taiwan as a separate trading nation would deepen tensions with Beijing in an already fraught environment. Diplomats on both sides are cognisant of this and are working privately to boost trade without official statements. But the lack of a formal agreement has seen Australian wine take only 12 per cent of the market where European and US wine dominate.

Six tonnes of fresh Taiwanese pineapple are scheduled to arrive in May but overall, trade negotiations between the two Indo-Pacific democracies remain at the margins.

“We’ve got a very strong economic relationship with Taiwan,” says Australia’s Trade Minister Dan Tehan. “I can see no reason why that can’t continue.”

Trade Minister Dan Tehan says the solidarity expressed by Taiwan, the US and Europe in Australia’s trade difficulties with China was encouraging.

Trade Minister Dan Tehan says the solidarity expressed by Taiwan, the US and Europe in Australia’s trade difficulties with China was encouraging. Credit:Dominic Lorrimer

He said that while trade deals with Europe, the UK and Israel were a priority, the solidarity expressed by Taiwan, the US and Europe in Australia’s trade difficulties with China was encouraging.

In his strongest public comments on the Australia-China relationship since taking office, US Secretary of State Antony Blinken on Thursday singled out China for its “blatant economic coercion of Australia” and said it threatened the collective security and prosperity of the international system.

Tehan says there has been “a lot of empathy from countries globally because people think that there seems to be some unfair targeting going on”.

“We need to be reassured that other countries are looking at what’s happening and thinking that this isn’t how countries should behave towards each other,” he says.

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The Australian government has also been attempting to navigate the complexities of a changing relationship with China while those who have the most to lose, businesses, wear the economic hit.

Australia’s ambassador to Beijing, Graham Fletcher, told an Australia-China Business Council meeting on Thursday that the two countries were in a “stand-off” and the public nature of the dispute had made it hard for either side to back down.

“I’m not sure China realises the damage that is occurring both in Australia and internationally. It’s been exposed as quite unreliable as a trading partner and even vindictive,” he said.

The Coalition - conscious of the potential for an electoral blowback on its China policy after taking decisions to block Chinese telecommunications provider Huawei, restrict foreign investment deals and call for an independent inquiry into the coronavirus - has been briefing industry throughout.

It is vulnerable to attacks from Labor, particularly in WA (home to Australia’s largest rock lobster farms) where Labor’s trade spokeswoman Madeleine King has been critical of Australia’s China trade policy. The Coalition can not afford to lose one seat at the next election or it will lose majority government.

Papacosta, whose seafood members are among the most exposed in the country to retribution from China and has fewer readily available alternative markets, says the government had been direct in its consultation.

“They are not just sending messages down the line,” she says. “They have been very clear on their position. That helps as an industry when you are planning your approach or pivoting.

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Tehan says he has been “upfront and honest” with businesses about what Australia was trying to achieve.

“It’s actually been quite humbling for me because there have been businesses that have been hurt,” says Tehan. “But they’ve understood that ultimately we’ve got to protect our sovereignty, and we’ve got to protect our national interests.”

The lobsters of Australia and the pineapples of Taiwan are likely to remain caught in the diplomatic crossfire for the foreseeable future.

There’s just one last combination left to drive the bilateral relationship: pineapple on lobster?

“Well, I’m going to shoot myself in the foot here and say I like a Hawaiian pizza,” says chef Greeno. “So why not?”

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