Australian Prime Minister Scott Morrison. Photo: VCG

Australia's parliament on Thursday passed legislation empowering its federal government to veto any agreement struck with foreign states, a move likely to further worsen China-Australia ties which are already extremely tense, as Chinese experts warned that Canberra should be careful and avoid any escalation to cause non-repairable damage.

"Australia's policies and plans, the rules that we make for our country are made here in Australia according to our needs and our interests," Australian Prime Minister Scott Morrison told reporters in Canberra, Reuters reported. Morrison has stressed the law is not aimed at any country, but it is widely seen by analysts as directed at China.

Chinese analysts said the bill will threaten the participation of Victoria, a federal state of Australia, in the China-proposed Belt and Road Initiative (BRI), which Morrison said weakens the federal government's ability to control foreign policy.

Chen Hong, director of the Australian Studies Center at East China Normal University in Shanghai, told the Global Times on Thursday that "apart from Victoria's BRI deal, the Confucius Institutes in Australia will also be threatened if the Morrison administration wants to make trouble for them. The bill is like a weapon of Canberra, and can hit cooperation and exchanges that already exist, and also harm the atmosphere for the two countries to ease tensions."

Once Canberra launches a new offensive, Beijing will definitely retaliate, and then cooperation in educational and cultural exchanges will also be impacted and the damage will be unimaginable, Chen said, noting that "we hope the Morrison administration can handle current tensions with wisdom and far-sighted vision."

Sydney Morning Herald reported on Thursday that Morrison has extended an "olive branch to China," saying he is willing to discuss their list of complaints anytime, and reiterated Australia wants nothing more than "happy coexistence" with its largest trading partner.

Chen said "Morrison has made similar remarks from time to time to show his willingness to fix ties with China. But so far, we haven't seen any sign of concrete action from him.  Bilateral ties have already been damaged due to a series of provocations from Australia. Morrison needs to show some sincerity for a chance to discuss with China."