Davos WEF
Davos WEF

Australia wants its 'mutually beneficial' relationship with China to improve, Treasurer Frydenberg says

Key Points
  • The relationship between Australia and China deteriorated last year when Australia supported a call for an international inquiry into China's handling of the coronavirus.
  • China took several measures in 2020 that impeded Australian imports, ranging from levying tariffs to imposing bans and restrictions.
  • Canberra, for its part, asked the World Trade Organization to mediate a dispute over stiff duties on Australian barley in the Chinese market.
Australia-China trading relationship is very important and mutually beneficial, treasurer says
VIDEO3:0603:06
Australia-China trading relationship is important and mutually beneficial, treasurer says

SINGAPORE — Australia will continue advocating for its national interests but would like to see strained relations with China improve, Australian Treasurer Josh Frydenberg said Monday.

"The China-Australia trading relationship is ... very important," Frydenberg told CNBC's Will Koulouris. "It's mutually beneficial. Our resources have helped underpin China's economic growth and we welcome that."

"At the same time, China has been a very important market for Australia and our exports to China has helped boost incomes here in Australia – been an important source of revenue and job creation," Frydenberg told CNBC, as part of the network's coverage of the Davos Agenda.

The relationship between the two major trading partners deteriorated last year when Australia supported a call for an international inquiry into China's handling of Covid-19, which was first reported in the Chinese city of Wuhan.

... historically, we've had a very good partnership with China and we'd like to see that continue
Josh Frydenberg
Australian treasurer

China took several measures last year that restricted Australian imports, ranging from levying new tariffs to imposing bans. Canberra, for its part, asked the World Trade Organization to mediate in their dispute over stiff duties on Australian barley in the Chinese market.

Australia is one of the few developed nations in the world that exports more than it imports to China.

While Prime Minister Scott Morrison is open to a meeting with Chinese President Xi Jinping, he would only do so if there are no conditions attached, the Australian reported on Monday.

Local media in Australia said last year that the Chinese embassy there threatened the Australian government and reportedly listed its grievances toward Canberra.

The national flags of Australia and China are displayed before a portrait of Mao Zedong facing Tiananmen Square.
Frederic J. Brown | AFP via Getty Images

For his part, Frydenberg said Australia has a clear sense of its own national interests in areas of security, foreign investments as well as human rights.

"We'll continue to advocate and speak up for Australia's national interest but that shouldn't preclude, again, strong relationships in the region and historically, we've had a very good partnership with China and we'd like to see that continue," he added.

U.S. and its 'indispensable' role

Frydenberg said his government is looking forward to working with America's new President Joe Biden and explained that the strength of the Australia-U.S. alliance doesn't depend on which leader is in power in either country.

"The relationship has been strong and enduring — based on mutual respect, based on shared values and, certainly, shared interests," he said, adding that the United States has an "indispensable role in our part of the world, in the Asia-Pacific."

We're looking forward to a very constructive relationship between the U.S. and Australia and it's one that is critically important, not just to Australia but to the United States.
Josh Frydenberg
Australian treasurer

Under former President Donald Trump, the U.S. appeared to be retreating from a position of influence in the Asia-Pacific region.

Trump withdrew the U.S. from the Trans-Pacific Partnership agreement and Washington did not take part in the massive Regional Comprehensive Economic Partnership — signed by China and 14 other Asia-Pacific countries that would account for about 30% of the population worldwide, and global economy.

"We're looking forward to a very constructive relationship between the U.S. and Australia and it's one that is critically important, not just to Australia but to the United States as well," Frydenberg said.