2024 saw the Australia-China relationship consolidate a process of stabilization that had followed the election of the Anthony Albanese-led Labor government in 2022.

The year saw the lifting of the final trade restrictions that formed part of Beijing’s campaign of economic coercion against Australia, with live rock lobster exports – the last commodity subject to punitive trade actions – resuming in mid-December.

High-level bilateral engagements also picked up the pace. China’s Foreign Minister Wang Yi visited Australia in March, and met Australia’s Foreign Minister Penny Wong on the sidelines of the United Nations General Assembly in New York in September. Chinese Premier Li Qiang visited Australia in June, while October saw the first Australian cross-parliamentary delegation visit to China in five years. In mid-November Albanese met Xi Jinping on the sidelines of the G-20 summit in Rio de Janeiro – the third bilateral meeting between the two leaders. Interspersed between these meetings were key dialogues on foreign affairs, business, economics, and defense.

It was, nonetheless, not all smooth sailing. Beginning early in the year, China was the focus of publicly voiced concerns by Australia’s intelligence head about espionage and foreign interference activities. A dangerous maneuver in the Yellow Sea in May, in which a Chinese fighter jet dropped flares in the flight path of an Australian navy helicopter, was labeled “unacceptable” by Albanese. Chinese state press throughout the year continued to voice criticism against AUKUS and the Quad, Australia’s engagement in joint military exercises in the South China Sea, and its procurement of Tomahawk missiles from the United States. Yet while each of these concerns caused friction, none derailed the overall trajectory of a gradual improvement in bilateral ties.

Entering 2025, however, the Australia-China relationship continues to face growing uncertainties. Many of these intersect with two political “known unknowns”: the result of Australia’s federal election, which could see the return of a Coalition government with a checkered history of managing relations with Beijing, and the policy decisions of the mercurial Trump administration, which could heighten contradictions between Australia’s security alliance with the U.S. and economic interdependence with China.

While there are a number of contenders for the shortlist of factors that could have the most significant impact on bilateral ties, three areas stand out: (1) trade and critical minerals; (2) developments in AUKUS and the Australia-U.S. alliance; and (3) increasing tensions in the South China Sea.

Trade and Critical Minerals

Canberra’s navigation of its major security and trade relationships is poised to become more challenging as the new administration in Washington appears to be locked into what former Trump adviser Steve........

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