Sydney [Australia], April 25 (ANI): The ties between two countries have further strained as Australia cancelled agreements to participate in China's Belt and Road Initiative, terming it as "inconsistent with country's foreign policy."
Foreign Minister Marise Payne earlier on Saturday announced Canberra was cancelling two agreements by Victoria, the country's second most populous state, to participate in China's Belt and Road Initiative.
She said they were "inconsistent with Australia's foreign policy or -adverse to our foreign relations" but did not elaborate, reported Asia Times.
The BRI became Xi Jinping's signature economic policy soon after he assumed power at the end of 2012. It aims at making China the center of global production and trade, radiating outwards through rail lines across the Eurasian landmass and sea routes to East Africa, the Middle East and the Mediterranean.
So far Australia is the only country to tear up a signed BRI agreement.
Wang Xining, China's Deputy Ambassador to Australia, talking to National Press Club meanwhile took a shot at Australia on Saturday for being "the first" to ban Chinese telecom equipment giant Huawei from its 5G mobile networks and then persuading Britain and other security partners to follow suit, reported Asia Times.
Wang was signalling a response to a lull in Australia's sometimes shrill warnings about Chinese influence and espionage, wrote Hamish McDonald in an article in Asia Times.
Another sign of lessening prickliness was that Wang was helping launch the latest China Yearbook by the Australian National University's China in the World Institute, whose scholars have often critiqued the leadership style and policies of President Xi Jinping.
But if this was a slight opening in China's shut door to Prime Minister Scott Morrison's government, it didn't get a matching response.
Last December, Morrison's government enacted a new law under the federal powers of the Australian constitution giving Canberra sway over foreign relations and defense. The law required the Department of Foreign Affairs and Trade to vet all foreign agreements by state governments, local councils and public universities.
This first exercise of that power follows a string of measures that have irked China: a new law in 2017 requiring registration of foreign lobbyists and banning foreign donations to political parties, the 5G ban on Huawei in 2018, a federal police raid on four Chinese state media journalists, and last year's call for an independent inquiry with "weapons inspector" powers into the origins of the Wuhan outbreak of COVID-19.
The latter was followed by a series of Chinese restrictions on Australian shipments of barley, beef, timber, lobsters, wine and coal amounting to some AUD 20 billion (USD 15.5 billion) in lost exports.
"By using this domestic law, Australia basically fired the first major shot against China in trade and investment," said Chen Hong, a specialist in Australian studies at Shanghai's East China Normal University to the Global Times, Chinese state-owned media. "China will surely respond accordingly."
But where? China's trade sanctions have been largely countered at a macro-level by a rise in the price of iron ore caused by Beijing's domestic stimulus measures and continuing supply constraints in Brazil, Australia's main exporting competitor, wrote McDonald.
It would take China billions of dollars and some five years to open up the largest alternative source of the steel raw material, the Simandou deposit in the West African nation of Guinea, 650 kilometers from the sea and 40 days sailing from China as opposed to 15 days from Australia's Pilbara ports.
There remain a few export sectors where China could still hurt Australia short of this major step. A bigger hit could come if Chinese authorities actively discourage or block Chinese students enrolling at Australia's universities and colleges, or tourists making visits.
Temporarily these weapons aren't available because of COVID-19 travel restrictions.
Moreover, Australia is also worried that China was using the BRI to load up poorer countries with debt and reduce Australia's influence in the region.
Sino-Australian relations have been in a downward spiral since April last year when Canberra infuriated Beijing by proposing an independent international inquiry into the origins of the COVID-19 pandemic. (ANI)