China country brief
After establishing diplomatic relations with the People's Republic of China in 1972, Australia established an embassy in Beijing in 1973.
The Australia-China bilateral relationship is based on strong economic and trade complementarities and longstanding community and cultural links.
In 2014, the Australian Prime Minister and Chinese President agreed to describe the relationship as a "comprehensive strategic partnership".
In recent years, the relationship has come under strain. Nevertheless, the Australian Government remains committed to a mutually beneficial and respectful relationship with China in which we can pursue our shared interests, while remaining consistent with our own national sovereign interests.
Both sides acknowledge that Australia and China have different histories, societies and political systems, as well as differences of view on some important issues. Australia adheres to its one-China policy, which means we do not recognize Taiwan as a country. We maintain unofficial contacts with Taiwan promoting economic, trade and cultural interests.
Australia raises a wide range of human rights issues with China including freedom of expression, freedom of religion, treatment of political prisoners and ethnic minorities (including abuses in Xinjiang and Tibet), torture, the death penalty, and the rights of legal practitioners and civil rights activists. Where appropriate, we also raise our concerns at multilateral fora such as the Human Rights Council.
Australia has largely phased out bilateral aid to China. In recognition of China's growing role as an aid donor, Australia and China signed a Memorandum of Understanding (MoU) on development cooperation in 2013, which was renewed in 2017. The MoU facilitates cooperation in shared development objectives on issues of regional or global importance.
Australia's diplomatic network in China includes the embassy in Beijing and consulates in Shanghai, Guangzhou, Chengdu, Shenyang and Hong Kong. There are also eight Austrade offices across China, assisting Australian businesses to enter markets and promote Australia as an investment, tourism and education destination. Most Australian state governments are represented in China's leading commercial centres. Australia and China share around 100 sister-state/province and sister-city relationships.
Trade and investment
China is Australia's largest two-way trading partner in goods and services, accounting for nearly one third (31 per cent) of our trade with the world. Two-way trade with China declined 3 per cent in 2020, totalling $245 billion (Australia’s global two-way trade declined 13 per cent during this period). Our goods and services exports to China totalled $159 billion in 2020, down 6 per cent compared to 2019. This decline largely reflects reduced services exports as a result of the COVID-19 pandemic (down 36 per cent in 2020). A series of trade restrictive measures by China has also impacted Australian goods exports to China, which were around 7 per cent lower in the second half of 2020, compared to the second half of 2019.
The China–Australia Free Trade Agreement (ChAFTA) entered into force on 20 December 2015. ChAFTA is an historic agreement that is delivering enormous benefits to Australia, enhancing our competitive position in the Chinese market, boosting economic growth and creating jobs. Businesses have taken advantage of lower tariffs under the agreement, with a utilisation rate of over 90 per cent in both directions.
Australia’s foreign investment review framework is open, transparent and non-discriminatory. Chinese investment in Australia is a highly valued part of the bilateral relationship. China is the sixth-largest foreign direct investor in Australia ($44 billion in 2020), accounting for 4 per cent of total foreign direct investment (FDI). In recent years, Chinese investment has broadened from mainly mining to sectors such as infrastructure, services and agriculture. Australian FDI in China totalled $7 billion in 2020. Our expertise in banking and wealth management services has seen financial institutions become some of the largest Australian investors in China.
Strong economic complementarities continue to underpin our mutually beneficial trade and Australian businesses continue to successfully enter the Chinese market. However—as with all cross border commercial activities—there are risks. Doing Business in China informs Australian companies about how best to manage risks and offers best-practice guidelines to dispute resolution.
Chinese tourism to Australia is supported through access for Chinese nationals to Australia's SmartGate, online lodgement for visitor visas and an additional online lodgement service in simplified Chinese language through the Australian Visa Application Centres (AVACs) in China. Visa fast track services (priority processing within 48 hours) and a 10-year visitor visa option are available for Chinese applicants for business and tourist streams. Australia looks forward to welcoming students and travellers when borders reopen.
Australians are increasingly purchasing products from China through online shopping sites. There are risks buying products from an overseas-based online seller and difficulties exist in obtaining a remedy from them. The Australian Competition and Consumer Commission (ACCC) provides information regarding shopping online.
Community and cultural links continue to develop strongly and play a vital role in the Australia-China relationship. Chinese migration started in the middle of the nineteenth century and Mandarin is now the second most spoken language in Australia after English. Chinese Australians have contributed significantly to the development of Australia and also foster people-to-people links with China. In addition to immigration, education, trade and tourism also bolster these links.
While travel restrictions as a result of COVID-19 have impacted international travel, Australia remains one of the most popular destinations for Chinese students wishing to study overseas. China continues to be Australia's largest source of overseas students.
In the other direction, China is a key destination for Australia's New Colombo Plan. The initiative will help to lift knowledge of China in Australia and strengthen people-to-people and institutional relationships, through study and internships undertaken by Australian undergraduate students in China.
Prior to the imposition of restrictions on international travel, China was Australia's largest inbound market in terms of visitor arrivals and total visitor spend. China remained the largest source country for visitor visa applications in the first half of 2020-21. Due to COVID-19 travel restrictions, all visitor visa arrivals over this period have been in an exempt category, received an individual travel exemption or travelled under the New Zealand Safe Travel Zone arrangements. In 2019-20, there were over 4.6 million visitor arrivals from China, which not only contributed to the Australian economy but also increased understanding about Australia in China.
Australia-China engagement in education, science, business and culture brings significant economic, social and cultural dividends to both countries and adds value to the bilateral relationship. In 2019, the Foreign Minister announced the establishment of the National Foundation for Australia China Relations. The Foundation works to build links between our country and China, by bringing together government business and communities to find and support ways to engage constructively with China. Through its competitive grants program the Foundation supports projects, including with cultural, sporting and educational institutions and the Australian-Chinese communities, that strengthen understanding of each other's society and cultures and promote greater people-to-people engagement. For more information about the Foundation, go to australiachinafoundation.org.au.
In 2014, Australia and China established a 1.5 track leadership forum, the Australia-China High-Level Dialogue. The Dialogue aims to enhance mutual understanding by bringing together senior Australian and Chinese government representatives with business, academic, and social leaders to discuss key issues affecting the relationship. These can include political and strategic issues, economic policies, and social and cultural developments. The inaugural High Level Dialogue was held in December 2014 in Beijing. The sixth Dialogue was held in January 2020 in Sydney. Australia's delegation was led by the Hon John Howard OM AC.
High-level visits and meetings
- In January 2020, former Prime Minister the Hon John Howard OM AC co-chaired the Australia China High-Level Dialogue in Sydney with Mr Li Zhaoxing, Honorary President of the Chinese People's Institute of Foreign Affairs and former Minister of Foreign Affairs.
- In November 2019, Prime Minister Morrison met Chinese Premier Li Keqiang in Bangkok for the Annual Leaders' Meeting.
- In November 2019, Trade, Investment and Tourism Minister Birmingham visited Shanghai to lead Australia's delegation to the China International Import Expo (CIIE) and participate in ministerial discussions on World Trade Organisation (WTO) matters.
- In October 2019, Prime Minister Morrison met Chinese Vice President Wang Qishan in Jakarta.
- In September 2019, Foreign Minister Payne held a bilateral meeting with State Councilor and Foreign Minister Wang Yi on the sidelines of the UN General Assembly meeting in New York.
- In August 2019, Foreign Minister Payne and State Councilor and Foreign Minister Wang Yi held a bilateral meeting on the sidelines of the East Asia Summit Foreign Ministers' Meeting in Bangkok.
- In August 2019, Trade, Investment and Tourism Minister Birmingham visited Beijing for Regional Comprehensive Economic Partnership negotiations.
- In June 2019, Prime Minister Morrison met President Xi Jinping during G20 meetings in Osaka.
- In June 2019, Sports Minister Colbeck visited Shanghai.
- In January 2019, Defence Minister Pyne visited China and met Chinese Minister of National Defence General Wei Fenghe.
- In December 2018, Prime Minister Morrison met President Xi Jinping during G20 meetings in Buenos Aires.
- In November 2018, Prime Minister Morrison met President Xi Jinping during the APEC Leaders' Meeting in Port Moresby.
- In November 2018, Prime Minister Morrison and Premier Li Keqiang held their Annual Leaders' Meeting in Singapore.
- In November 2018, Foreign Minister Payne and State Councilor and Foreign Minister Wang Yi co-chaired the Fifth Foreign and Strategic Dialogue in Beijing.
- In November 2018, Trade, Investment and Tourism Minister Birmingham visited Shanghai leading an Australian delegation to the China International Import Expo.
- In September 2018, Foreign Minister Payne met State Councilor and Foreign Minister Wang Yi during the UN General Assembly in New York.
- In May 2018, Trade and Investment Minister Ciobo visited Shanghai.
Trade data current as of July 2021. Note half-year trade values are deficient due to ABS suppression of some confidential items of trade from China’s trade totals.