Get more with myNEWS

A personalised news feed of stories that matter to you

Learn more

In this issue of the Global Impact newsletter, we look back at the long-awaited visit to China by Australian Prime Minister Anthony Albanese and what it means for future relations between Canberra and Beijing. Photo: EPA-EFE

Economy Global Economy

Global Impact: China, Australia ‘embark on the right path’ after Anthony Albanese meets Xi Jinping in Beijing

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world
In this issue, we look back at the long-awaited visit to China by Australian Prime Minister Anthony Albanese and what it means for future relations between Canberra and Beijing

China-Australia relations

Kandy Wong

Published: 2:00pm, 13 Nov 2023

Why you can trust SCMP

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world. Sign up now!

Behind the symbolic meeting between Australian Prime Minister Anthony Albanese and President Xi Jinping in Beijing on Monday, Australia has been arduously performing a balancing act between geopolitics and the economy.

Albanese is the first Australian prime minister to visit Beijing in seven years, which reflects a stabilisation in the relationship between the two countries that had soured in 2020 when the previous administration called for an international probe into the origin of Covid-19.

Xi said bilateral ties had “embarked on the right path of improvement and development”, adding that exchanges had resumed and some problems had been worked out, according to state broadcaster CCTV.

Both sides welcome the restoration of high-level dialogues

Joint statement

Albanese also talked to reporters after meeting with Xi, saying: “Both of us certainly agreed that we shouldn’t be defined by our differences, recognise that they are there, but also recognise the mutual benefit that we have.”

After Albanese met with Premier Li Qiang on Tuesday, a joint statement was issued and said: “Both sides welcome the restoration of high-level dialogues.”

Since the Labour Party in Australia wrestled back power in May 2022, Albanese started working on resuming normal ties with his country’s largest trading partner, which is also the biggest consumer of Australian iron ore in the world.

Sources told the Post that Albanese wanted to go to Beijing before May, but Beijing responded that the proposed time “was inconvenient”, as it was when the Aukus announcement related to the nuclear-powered submarine programme – a trilateral security partnership for the Indo-Pacific region between Australia, the United Kingdom, and the United States – was made.

03:01

China-Australia relations ‘on the right path’, Xi Jinping tells Anthony Albanese on Beijing visit

Instead, China issued an invitation “in principle” to Albanese with a time frame of making the long-awaited visit by October, which marked the 50th anniversary of the first trip to China by then-Australian prime minister Gough Whitlam in 1973.

To attend the sixth China International Import Expo to promote trade, Albanese eventually landed in Shanghai on November 4, before flying to Beijing to meet his Chinese counterpart, and wrapping up his trip on Tuesday.

Before the bilateral meeting between Xi and Albanese, China agreed to review the tariffs it had imposed on Australian wine, which had all but wiped out Australia’s Chinese wine market that had been worth about US$1.2 billion a year.

It is also expected that trade barriers on Australian lobsters and beef will also be resolved.

In August, China removed the anti-dumping and anti-subsidy tariffs on Australian barley that had been applied for more than three years.

Other Australian products such as coal, cotton and timber, which were under unofficial bans over the past few years, have been returning to the Chinese market since early this year.

Sources said that the Australian and Chinese sides started working out a series of understandings after Albanese had an ice-breaking chat with Xi on the sidelines of the G20 summit in Jakarta a year ago, paving the way for the meeting of the two leaders in the Chinese capital.

Besides finding resolutions for trade sanctions on Australian products, Australia’s support for China to participate in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is another key issue on the table.

02:27

Anthony Albanese becomes first Australian prime minister to visit China in 7 years

Before Albanese set off on his China trip, sources told the Post that Australia would “consider China’s application on its merits” and “will not advocate for Taiwan’s CPTPP membership, despite Japanese pressure to do so”.

The Post also cited sources in May saying that “it would be impossible for the Australian government to publicly support the Chinese membership when trade sanctions were in place” during the visit by trade minister Don Farrell to Beijing.

“China seeks membership in the Pacific free-trade bloc, which requires Australian agreement. This may form part of a trade-focused set of future steps, but there’s also some pressure on the government to not agree,” said Warwick Powell, a former state-government adviser to former Australian prime minister Kevin Rudd.

Speaking to reporters about China taking part in the CPTPP, after his meeting with Xi, Albanese noted that: “[It] needs a unanimous agreement by all of the parties and countries if they are going to get accession to the agreement … Now, we look at any of the applicants, and I think there are six applicants, before that’s worked through with other countries.”

Canberra ‘will not oppose’ China’s CPTPP trade-pact bid

But despite the realisation of a stabilised relationship between both countries, the overall tone remains cautious, with Australia’s security concerns over the South China Sea, its involvement in Aukus and the Quadrilateral Security Dialogue, as well as the fate of detained journalist Yang Hengjun.

In September, Minister for Foreign Affairs Penny Wong also announced that Scott Dewar had been appointed the next Australian ambassador to China, starting from January, with Graham Fletcher set to finish his term by the end of the year.

However, sources close to the Australian government said that “this decision by the Albanese government is very worrying”, with Dewar’s background as a Quad Sherpa for the Department of the Prime Minister and Cabinet and deputy secretary of Aukus in 2021.

“In my opinion, the decision to overlook well-qualified diplomats with decades of China experience clearly indicates the total takeover of China policy by national security,” a source added.

60-Second Catch-up

Xi Jinping tells Anthony Albanese China-Australia ties are now ‘on the right path’

Australia’s Albanese promises ‘patient, calibrated’ talks with Xi Jinping in Beijing on Monday

Opinion: US proxy Anthony Albanese goes to Beijing

Opinion: New China-Australia relationship puts paid to blinkered approach

Deep dives

Australia’s lack of independent China policy ‘greatest risk’ to stable ties

The Australia-US alliance and security concerns are ‘impediments’ to better China ties and will over time erode trade and people links, the think tank report notes
Australia’s strategic choices show it is under ‘significant pressure from the US’ and do not indicate they are driven by Australia’s own national interests, the report adds

Australia’s inability to form an independent foreign policy as it plays hostage to its alliance with the United States will jeopardise long-term stability in its relationship with China, according to a new report by prominent Australian think tank China Matters.

While the relationship has improved in the past year, culminating with Australian Prime Minister Anthony Albanese’s historic visit over the weekend to China, the report said the Australia-US alliance and increasing concerns in both countries over national security issues threatened long-term stability in relations.

CIIE 2023: Li Qiang promotes Chinese consumers as fix for global economy

China’s middle class has ‘colossal purchasing power’ with ‘huge’ potential for foreign businesses, Li says at world’s biggest import fair
Australian leader Anthony Albanese also addresses event, saying regional economies have prospered because of stability from ‘rules-based trade’

Consumer vigour and further opening up in China could give a much-needed boost to the stalling global economy, Premier Li Qiang said on Sunday, in the latest sign that Beijing is trying to improve business ties with its major trading partners.

Speaking to more than 1,000 government officials and business leaders at the start of the China International Import Expo (CIIE) in Shanghai, Li pledged that China would further relax policies and buy more goods from foreign businesses, offering greater opportunities to international companies.

Australia wants ‘new type of relationship with China’, observer says

Given its close trade ties with both US and China, Australia could potentially act as a bridge in multilateral ties, Sichuan University professor says
Albanese’s announcement of November 4-7 visit to China follows breakthrough in dispute over damaging wine tariffs

Rapidly shifting global dynamics could see Australia explore new economic ties with China, an observer said.

This came as Australian Prime Minister Anthony Albanese announced he would visit Beijing next month to meet President Xi Jinping, and China indicated it would suspend tariffs on Australian wine.

Australia’s Albanese to be ‘direct’ with Xi over South China Sea in Beijing talks

Albanese’s trip is aimed at mending fences with China after years of bilateral rows over trade and other issues
He notes several positives ahead of the trip, including the release of Australian journalist Cheng Lei and the lifting of certain export curbs

Australian Prime Minister Anthony Albanese said on Tuesday he would not hesitate to raise contentious issues during his meeting with Chinese President Xi Jinping later this week, as both sides aim to steady ties after years of diplomatic acrimony.

Albanese will also hold talks with Premier Li Qiang when he travels to Beijing for three days from November 4, the first by an Australian leader since 2016.

Canberra ‘will not oppose’ China’s CPTPP trade-pact bid

China has been trying to gain entry into the Asia-Pacific trade pact for two years, and Australia says it will ‘consider China’s application on its merits’ as bilateral ties warm
Both countries have made concessions on trade and investment, but source says relations will never ‘return to the status quo’

With relations between China and Australia improving in the lead-up to Prime Minister Anthony Albanese’s long-anticipated visit next week, sources said Canberra will not stand in the way of Beijing joining one of the world’s biggest multilateral trade deals.

Australia “will not oppose China joining the CPTPP” – the Comprehensive and Progressive Agreement for Trans-Pacific Partnership – and will “consider China’s application on its merits”, one source said, emphasising that this is not a vow to advocate for China.

2-way street: China trade putting money in Australian pockets, study finds

A study commissioned by an Australia-China business organisation shows trade with China has added to Australians’ incomes and kept cost of living down
Preliminary release of data adds weight to arguments for sustained engagement as relations back on upswing

As a direct result of trade between China and Australia, households in the latter country have seen several benefits, according to a study released on Wednesday.

The findings come at a time of warming relations between the two countries and provide fresh support to the case for economic engagement.

China-Australia decoupling ‘impossible’, classified studies conclude

Separate administrations conducted investigations into the feasibility of ‘diversifying’ import-export relationship, all resolved such a decoupling would be unmanageable
Current relations came after years of networking by exporters and cannot be replicated elsewhere, analysts say

Australian authorities conducted three separate internal studies in the past eight years to determine whether the commodity-exporting nation could completely diversify its supply chains from China – but all said the task was impossible, according to two sources with knowledge of the matter.

The unanimous and non-partisan judgment helped to justify Canberra’s renewed trade engagement with Beijing late last year despite obstacles such as Aukus, a regional security pact between Australia, the United Kingdom and the United States.

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world.