Dear Focus Reader,

This week marked a notable deepening of ties between Beijing and Canberra, as Australian Prime Minister Anthony Albanese traveled to China for a six-day visit that included high-level meetings with President Xi Jinping and Premier Li Qiang. The visit culminated in the 10th Annual Leaders' Meeting and delivered a suite of cooperative outcomes, signaling continued momentum in stabilizing one of the Asia-Pacific's most significant bilateral relationships.

A major highlight was the launch of a Policy Dialogue on Steel Decarbonization, a move that aligns with China's new mandate for steel and cement plants to use renewable electricity. The initiative opens up pathways for Australia, a major iron ore exporter, to participate in green steel development, combining climate goals with long-term trade strategy.

Both sides also committed to expanding cooperation in energy, agriculture, tourism, education, and culture. Premier Li said the two economies are "highly complementary" and called for a stronger multilateral trading system. Prime Minister Albanese, in turn, reaffirmed Australia's "One China" policy and emphasized the need to manage differences constructively.

While Washington did not issue a formal response to the meetings, the visit drew attention from U.S. officials and analysts. Some cautioned Australia against drifting too closely toward Beijing, particularly on critical supply chains and defense. Former U.S. defense official Elbridge Colby urged Canberra to increase its military spending and prepare for regional scenarios involving China, while stressing that security alignment with the U.S. should remain paramount.

Also in Beijing, Chinese Foreign Minister Wang Yi met with Indian External Affairs Minister Subrahmanyam Jaishankar on July 14. The two discussed regional cooperation and the disputed Himalayan border, with both sides emphasizing the need for stability. While Jaishankar has recently strengthened India's defense ties with Washington, the visit showed New Delhi's continued willingness to engage with Beijing, a critical channel for maintaining border peace.

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