Premier Li Keqiang and Australian Prime Minister Julia Gillard yesterday agreed to hold annual prime ministerial meetings, as Chinese money drives Australia's huge resource boom.
They held talks at the Great Hall of the People in Beijing, where Gillard was greeted with full military honours.
Australia's economy has gained from Chinese demand for resources including iron ore, and China is now its largest trading partner with two-way business in goods and services worth A$128 billion (HK$1.03 trillion). "Our two sides have decided that the prime ministers will have regular annual meetings either in a bilateral format or on multilateral occasions," Li said, adding that yesterday's talks could be "regarded as the annual meeting mechanism".
Gillard congratulated Li on his selection last month as premier.
"I am filled with optimism about the way we will be able to work together to take the relationship between our two countries forward," she said.
Gillard told a business forum in Beijing yesterday that the Australian and Chinese navies started holding live-fire naval drills almost three years ago and the region will benefit from closer co-operation between the two.
Gillard, who met President Xi Jinping on Sunday, underscored her nation's alliance with America while seeking closer ties with China. "I am committed to a relationship which goes well beyond the economy," Gillard said.
"Defence co-operation, which is already far broader and more effective than I think is generally understood, will grow."
Gillard said on Monday that China would start direct trading between the yuan and the Australian dollar today.
Yesterday she called for a more broad-based economic relationship and more diversified investment links. "We should set … a level and structure of dialogue which Australia shares with only a handful of countries and one which China also shares with only very few nations," she said.
Agence France-Presse, Bloomberg