Late last week, China’s National Development and Reform Commission (NRDC) announced it has “indefinitely suspended” its participation in the China-Australia Strategic Economic Dialogue in retaliation for the Australian Government scrapping Victoria’s Belt and Road Initiative. The program consists of high-level visits and wide ranging discussions between Australia and China and was last held in 2017. A Chinese Foreign Ministry spokesperson has warned Australia not to “walk further on the wrong path”, accusing the Morrison Government of imposing restrictions on business, trade and cultural cooperation between the countries.

The Australia China Business Council said the suspension of the dialogue marked a new low in the relationship and is deeply concerning to the business community. The Council warned not to take the announcement from the NRDC lightly, saying business and consumers in China take their cues from Beijing. The Council said the latest developments will have an impact over time and further erode the confidence of Australian companies doing business with China. Australian trade minister Dan Tehan called the decision “disappointing” and said Australia remains open to holding the dialogue and engaging at a ministerial level.

China severed all high-level diplomatic contact with Australia in April last year after the Morrison Government called for an international inquiry into the origins of COVID-19. Since then, senior Australian ministers are apparently struggling to get their Chinese counterparts to return their calls.