- Home
- About us
- Visas and migration
- Travelling to Australia
- Services for Australians
- Australia- China relationship
- Doing business with Australia
- Study in Australia
- Development cooperation
- Media
- About Australia
- Events
- 中文
Trade and Investment
The Australian and Chinese economies are strongly complementary. As a result, our trade and investment relationship is substantial and has developed well beyond its modest beginnings in the 1970s. According to Australian statistics, two-way merchandise trade has grown from $113 million in 1973, just after the establishment of diplomatic relations, to $45.9 billion in 2006. China is currently ranked as Australia's 2nd-largest trading partner, and Australia as China 's 11th-largest trading partner.
The launch of bilateral FTA negotiations by Prime Minister Howard and Premier Wen Jiabao in Beijing in April 2005 marked a significant milestone in the economic relationship. A comprehensive, high-quality FTA would build on the Trade and Economic Framework agreement signed during President Hu Jintao's visit to Canberra in 2003, which committed to further trade facilitation and liberalisation; the promotion of strategic cooperation in a broad range of key sectors; and strengthened high-level dialogue and cooperation on trade and economic matters.
During the visit by Premier Wen Jiabao to Australia in April 2006, Australia and China signed a Nuclear Transfer Agreement and a Nuclear Cooperation Agreement which will allow for the supply of Australian uranium to China 's nuclear power program, and cooperation in peaceful uses of nuclear technology. Further agreements were signed in areas such as agricultural technical assistance, and coal mine safety. The inaugural meeting of the bilateral High-level Economic Cooperation Dialogue also witnessed the signing of s ix commercial projects covering a range of energy and minerals, bauxite, iron ore, natural gas, coal and wind energy.
The first shipment of Australian Liquefied Natural Gas (LNG) to Guangdong in 2006 under a 25-year supply contract, will be a further highlight in the growing trade relationship.
Trade
Australian exports to China have grown very strongly in recent years, to become Australia 's second largest export market. In 2006, Australia 's merchandise exports to China rose by 27 per cent.
Australia has traditionally been an important supplier of the industrial raw materials and foodstuffs China needs for its industrialisation and modernisation. Around two-thirds of Australian merchandise exports to China are primary products - principally iron ore, alumina, wool, barley, coal, copper ores and oil and gas products.
Since embarking on the path of market reform in 1978 and in particular since WTO accession in 2001, structural change and rapid growth in the Chinese economy have increased the volume and scope of bilateral trade. In recent years, there has been a strong increase in exports of Australian manufactures such as electrical machinery and appliances and telecommunications equipment. Australian banks, law firms and insurance companies have an increasing presence the Chinese market. An increasing number of small to medium sized Australian companies have very successful businesses in China in niche sectors such as engineering, building, mining and agribusiness.
The combination of rising real incomes and reform of the services sector are boosting significantly services trade and investment between the two countries. Bilateral trade in services has expanded from A$1.47 billion in 2000 to A$3.35 billion in 2006. China was Australia 's 6th largest services export market in 2006, up from 13th largest in 1995. China is now Australia 's number one source of overseas students and fifth largest, and most rapidly growing, source of tourists. Expanded coverage of the Approved Destination Status (ADS) arrangements and increasing commercial flight links are expected to contribute to additional rapid growth in tourism – predicted to reach one million visitors per year by 2013.
China is Australia 's largest source of imports, led by clothing and footwear, computing, and toy and sporting goods imports. Imports of higher value-added products are growing strongly, reflecting China 's increasing presence in regional and global manufacturing chains for such items as computers, household electrical goods and telecommunications equipment.
Investment
Bilateral foreign investment has remained fairly modest relative to overall growth in bilateral trade between Australia and China . By the end of 2005, China was Australia's 20th largest source of investment destination (A$2.043 billion) with a focus on manufacturing, mineral exploration, legal, banking and education services. China (mainland) was the 18th largest investor in Australia (A$2.275 billion). China 's largest and high profile Australian investments are in the resources sector, reflecting China 's aim to secure upstream resources for its ongoing rapid industrialisation. Manufacturing and real estate also attract significant investment.
The potential for greater investment growth is strong. For China, Australia offers strong economical credentials , backed by a highly skilled and multilingual workforce , a dynamic services sector, sophisticated telecommunications and IT systems , and an open regulatory environment . For Australia , China offers a large market and a fast growing economy, and continues to improve its overall investment climate through regulatory, legal, financial, and taxation reforms.
Looking Ahead
The prospects for future for further growth in the scale and depth of the commercial relationship are excellent. The economic complementarities underpinning rapid growth in trade over the past decade are unlikely to abate. Importantly, government cooperation on trade issues has grown with the increasing integration of our economies. Australia is working closely with China to conclude the WTO Doha Development Agenda. We will continue cooperate closely on trade facilitation and other areas through AEPC, particularly during Australia 's hosting of APEC in 2007. Moreover, reaching agreement on a comprehensive high-quality Free Trade Agreement would offer the largest potential to take the economic relationship to a new level across merchandise trade, services, and investment.