[Source: Reuters]

Australia’s Prime Minister Anthony Albanese and Chinese Premier Li Qiang will meet in the first such visit to the country by a Chinese premier in seven years, with trade ties, regional security and a jailed Australian writer on the host’s agenda.

The visit by Li, China’s top-ranked official after President Xi Jinping, marks a stabilisation in relations between the U.S. security ally and the world’s second-biggest economy, after a frosty period of Beijing blocking $20 billion in Australian exports and friction over defence encounters.

Protesters and supporters gathered on Monday morning on the lawn outside parliament house in Canberra, where there was a heavy police presence, as a ceremonial welcome was held for Li.

Beginning with some panda and wine diplomacy on Sunday, Li is on a four-day visit that Australia’s foreign minister called “really important” and which the Chinese leader said showed bilateral relations were “back on track”.

Without China – which receives one-third of Australia’s exports and supplies one-fourth of Australia’s imports – Australians would pay 4.2% more for consumer items, an Australian business group said on Monday.

Trade with China increased Australia’s average household disposable income by A$2,600 ($1,700) last year, contributing 595,600 jobs or 4.2% of total employment, said the study by Curtin University and the Australia China Business Council.

“Managing geopolitical risks and concerns around defence and security will remain at the forefront of Indo-Pacific discussions,” the report said.

“Trade is not disconnected from these discussions.”

Australia is the biggest supplier of iron ore to China and China has been an investor in Australian mining projects.

Li’s visit will likely raise the issue of whether Australia will continue to accept high levels of Chinese investment in its critical minerals sector, as Western security allies push to reduce reliance on Beijing for the rare earths vital to electric vehicles.

Australia last month blocked several Chinese investors from increasing stakes in a rare earths miner on national interest grounds.

Albanese has said he will raise human rights issues in his talks with Li.

The suspended death sentence for China-born Australian writer Yang Hengjun was upheld by a Beijing court ahead of Li’s visit, his supporters said on Sunday.

They urged Albanese to ask Li to allow Yang’s transfer to Australia on medical grounds, saying in a statement it was “not possible to achieve a stable, respectful bilateral relationship with China while their officials are threatening to execute an Australian political prisoner”.

Yang, a pro-democracy blogger and spy novelist, was working in New York before his arrest at Guangzhou airport in 2019.

Australia has described his February sentence as “harrowing”, casting a shadow over the recent rebound in bilateral ties.