China has slammed Australia's "provocative" decision to tear up Victoria's Belt and Road Initiative agreement with Beijing, warning the move will damage their relationship.
Foreign Minister, Marise Payne, announced on Wednesday night that the infrastructure deal had been cancelled, under new foreign veto powers.
China's embassy in Australia responded swiftly, expressing "strong displeasure and resolute opposition" to Senator Payne's announcement. A Chinese embassy spokesperson said in a statement:
"This is another unreasonable and provocative move taken by the Australian side against China.
"It further shows that the Australian government has no sincerity in improving China-Australia relations.
"It is bound to bring further damage to bilateral relations, and will only end up hurting itself."
In December, the Morrison government legislated new powers to torpedo deals between individual states and foreign powers under the Foreign Relations Act.
The powers require the foreign minister to assess arrangements with foreign nations to check if they align with Australia's foreign policy goals.
Senator Payne said four agreements would be cancelled, two of which related to Victoria's Belt and Road deal for infrastructure investment, saying in a statement:
"I consider these four arrangements to be inconsistent with Australia's foreign policy or adverse to our foreign relations."
The Belt and Road “framework” agreement signed in 2019, allowed Victoria's engineering and design firms to bid for contracts for Belt and Road Initiative projects around the world.
Victorian Premier Daniel Andrews has previously advised against the cancellation of the deal.
There is an ongoing feud between the Victorian and federal governments due to the latter’s decision to not sign up for the $1.5 trillion global infrastructure initiative.
Premier Andrews believes it would create jobs and economic growth for Victoria. A state government spokeswoman said in a statement on Wednesday that the Foreign Relations Act was a matter for the Commonwealth:
"The Victorian government will continue to work hard to deliver jobs, trade and economic opportunities for our state."
Beijing has previously raised Canberra's veto power as one of 14 grievances damaging to diplomatic relations.
In the past 12 months, China has launched a series of damaging trade strikes against Australia due to a previous ban on Chinese company Huawei's operations in Australia, insisting upon an independent inquiry into China’s involvement in COVID-19 and criticisms of China's human rights record.
China is also disgruntled with Australia over foreign interference and investment laws.
-- with AAP