Xi tells Albanese that China’s ship will conduct exercises wherever they want in international waters

China’s supreme leader has lauded the improvements in his country’s ties under Labor and called for Anthony Albanese to help keep relations on track ‘no matter how the international landscape may evolve’.

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Xi Jinping has told Anthony Albanese his naval forces will conduct exercises wherever they want in international waters as the Prime Minister called for more notice of PLA-Navy drills near Australia and urged the Chinese President not to invade Taiwan.

Hosting Mr Albanese in Beijing’s Great Hall of the People on Tuesday, China’s supreme leader lauded the improvements in the countries’ bilateral ties under Labor, calling for the Australian leader to “unswervingly” maintain the positive momentum in the ­relationship “no matter how the international landscape may evolve”.

Mr Xi warmly welcomed Mr Albanese to the capital for their fourth meeting amid glowing state media coverage, with one of the Chinese Communist Party’s most influential mouthpieces saying his visit sent a message “to the wider world” amid Donald Trump’s ­tariff chaos.

The Prime Minister and his ­fiance, Jodie Haydon, were treated to a rare lunchtime banquet by Mr Xi, as well as a full military honour guard. A second feast followed in the evening with China’s No.2 leader, Premier Li Qiang.

Speaking after his meeting with the President, Mr Albanese revealed he had agreed to a review of the China-Australia free-trade agreement, amid Chinese calls for the deal to be expanded to allow closer co-operation on artificial intelligence and technology, which Australia has ruled out.

Mr Albanese said he raised February’s surprised live-fire drills by Chinese warships in the Tasman Sea which went on to circumnavigate Australia in an unprecedented show of force, while conceding the vessels had operated within their legal rights.

“I said what I said at the time, which was that it was within international law … but that we were concerned about the notice and the way that it happened, including the live-fire exercises,” he said.

“In response, of course, President Xi said that China engaged in exercises just as Australia engages in exercises.”

His comments came as ­Defence officials declined to say if they were tracking Chinese spy ships heading towards Queensland’s coast to monitor Australia’s biggest military exercise, Talisman Sabre, after earlier saying their ­arrival was expected soon.

Amid US calls for Australia to declare whether it would support its ally in a war with China over Taiwan, Mr Albanese urged Mr Xi to maintain the status quo on the self-governed territory, which the Chinese leader has ordered his forces to be prepared to seize by 2027. Asked whether he regarded China as a threat, he said: “We have strategic competition in the region, but we continue to engage in order to support peace and security in the region and stability in the region.”

At the opening of their meeting, Mr Xi said he and his guest had “reached many common understandings” during their past three meetings.

Speaking just over six months after China lifted the last of its $20bn in punitive trade bans on Australian exporters, Mr Xi said the countries could avoid further diplomatic tensions by “seeking common ground while sharing differences and pursuing mutually beneficial co-operation”.

“No matter how the international landscape may evolve, we should approach this overall direction unswervingly,” he said in a veiled reference to the global instability caused by Mr Trump – who Mr Albanese is yet to meet face-to-face. The Prime Minister said he and his Chinese counterpart did not speak directly about the US, and that Mr Trump’s trade policies had not changed how Australia approached its relationship with China.

Anthony Albanese meets with President Xi Jinping in Beijing Picture: PMO

“Our relationship with China is very separate from that. China is our major trading partner. The destination for more than one in four of our export dollars comes here. The trade with the United States is important, but it’s less than 5 per cent,” he said. Mr Albanese, who also had meetings with Premier Li and National People’s Congress chairman Zhao Leji, called on Mr Xi to release jailed Australian writer Yang Hengjun, who is serving a suspended death sentence on espionage charges.

He was not expecting any swift change in his status after six years of detention. “You wouldn’t expect there to be an immediate outcome. That’s not the way these things work. The way it works is by that patient, calibrated advocacy. That is what Australians do,” he said.

Despite anger at the highest levels in Beijing over Mr Albanese’s pledge to strip Chinese company Landbridge of its lease over the Port of Darwin, the Prime Minister said the issue was not raised. He said the President also didn’t raise Beijing’s longstanding complaints about Australia’s strict foreign investment regime that bars Chinese companies from taking stakes in critical infrastructure and other sensitive sectors.

Mr Li told Mr Albanese that the Australia-China relationship had “returned to the right track” and co-operation between the nations was “brimming with renewed vitality”.

“The world economy sees growing instability and uncertainty,” he said.

“Given such circumstances, China and Australia – as important trade partners – should strengthen dialogue and co-operation. ”Mr Albanese received lavish praise from Beijing’s most authoritative English language newspaper, the China Daily, ahead of the high-level meetings.

“Australian Prime Minister Anthony Albanese’s ongoing visit to China is not only of significance for the bilateral and trade relations between the two countries, it also sends a message amid the changing global trade landscape,” the paper said in an editorial.

“Against the backdrop of rising tensions between the United States and many countries because of the US administration’s recent threat to levy higher tariffs on them from August 1, Albanese’s visit shows that the Australian side has a clearer Judgement and understanding of China than it had under the previous Scott Morrison government.”

Mr Albanese waits to meet with China’s President Xi Jinping in the Great Hall of the People in Beijing Picture: AAP

Mr Morrison, whose government fell out with China after calling for an international inquiry into the origins of Covid-19, responded in a brief statement to The Australian. “Having a character reference from the China Daily was never one of my foreign policy aspirations,” the former prime minister said.

Mr Albanese was due to stop at the Great Wall of China on Wednesday, which Labor luminary Gough Whitlam visited as Labor leader in 1971, before departing for Chengdu where he will visit the world’s largest panda breeding facility and tour the Chinese manufacturing facility of Australian bionic ear company, Cochlear. Business Council of Australia chief Bran Black, who led a delegation of 14 of Australia’s top CEOs at a business roundtable in Beijing on Tuesday, said the resumption of annual Australia-China leaders’ meetings was vital to stepping up business ties. “It’s so important to have those strong engagements at the leader level, because what that does is set the tone for the engagements that at a business to business level as well,” he said.

Mr Black said there was “enormous interest” from Chinese businesses in investing in Australia, but the business community accepted all nations maintained foreign investment rules in the national interest.

“We welcome and we encourage investment in Australia as much as possible. We think it is a good thing, but it is also incredibly appropriate that all investment is tested and tempered by these types of processes that we have in place and that other countries have in place. What we would like to see is those processes sped up, but that’s work that the government is undertaking.”

China’s President Xi Jinping in discussion with Prime Minister Anthony Albanese Picture: AAP

He said Australian businesses accepted the government had a mandate for its decision to revoke Landbridge’s lease over the Port of Darwin.

“What we seek to do in these types of circumstances … is make sure that we can operate within the scope of the diplomatic relationship … to the greatest possible extent.”