"The Prime Minister's visit to China is a welcome and timely opportunity to reset Australia's relationship with our largest trading partner," Innes Willox, Chief Executive of the national employer association Ai Group said today.
"The visit will be as much political as economic in focus given the deterioration in the relationship over the past decade, to the point at times of being virtually non-existent, in the face of ongoing national security differences.
"While those differences will not disappear, it is heartening for Australian industry that there are signs that a broad economic relationship is re-emerging as punishing tariffs and non-tariff barriers start to be wound back including the hopeful removal of restrictions on Australian wine. We are also seeing Chinese students return to Australia in large numbers and tourist numbers are on the increase as well.
"While China will no doubt continue to be our most important economic partner, especially given their hunger for our commodities, the reality is that the difficulties of the past decade have fundamentally shifted how many Australian sectors and businesses view China.
"For many, those difficulties have meant they have shifted their focus away from China to other markets and sources as part of what is known as a 'China plus one strategy'. That diversification is aimed at de-risking and diversifying Australia's economic relationships.
"However, given the size and strength of the market and the fact that we enjoy a trade surplus with China, it remains economically vital that Australia has a stable political and diplomatic relationship with Beijing. That is why the Prime Minister's visit to mark 50 years of diplomatic relations is so important to the long-term interests of Australian industry.
"The Government is right to downplay expectations of the visit given how febrile the relationship had become. The strains the Chinese economy currently faces as it seeks to reshape itself should also not be underestimated.
"Australian industry hopes the visit marks the start of an upswing in the relationship and provides more certainty to deal with China as a key market for our overall economic success," Mr Willox said.
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